Best New Year Resolution: A Financial Checkup


BANGALORE: Every now and then people go for monthly check-up from the doctor. But do you remember to take care of your fiscal health too? Just like your body, even your credit health requires a professional treatment and a credit health specialist.

Just like your insurance premium increases with poor physical health, you might be paying higher interest rates on loans if you are credit un-healthy.

Poor Credit Health can lead to higher interest rates on loans, job rejections, loan denials, credit card denials from banks. Financial Institutions and even potential employers ascertain an individuals' credit health before sanctioning a loan or employment.

The first step in your financial checkup is evaluating your financial goals. Without financial goals and specific plans we drift along and leave our future to chance. You might have different financial goals be it saving for your kids, buying a car, moving into your dream home. Find out if you have made progress on these goals this year?

If you don't notice any progress find out where you lacking and why you are deferring from this goal? It is possible you might have a few changes in the list that prioritize your goals. If you have new goals or have made some changes note that down. Based on your needs break your financial goals into short term and long term goals.

Review your investments you always struck with this thought of "when is the good time to make an investment?" But there is no concrete answer to this question for everyone. Whether you make frequent changes or rarely touch your investments this is a good way to check and make sure things on still on track. Check if your investment strategy needs to be changed?

 Check if any target date fund just changed their investment strategy or increased the expense ratio. Make sure that whatever your investments are that they are a reflection of how you plan on reaching a goal. Evaluate Your Debts you should evaluate your Debt to income ratio. That shows how well you are doing on controlling and paying down debt?

If you have availed a loan find out what is the interest rate? A slightest change in the interest rate does make a huge difference to your finance. Above all don't forget to have a check with on your credit score.

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