Financial preparedness is key to a stress-free future for you and your family. From saving and investing early and often to budgeting and making smart money choices, there are many things that will typically put you on the right financial track.
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However, there is one specific financial initiative that financial guru Suze Orman wants you to do before the new year rolls around.
‘Make a Date with Your Money’
On one of her latest Suze School podcasts, she explained that she wants you to “make a date with your money.” Whether it’s by yourself, with your spouse or partner or with your children, make a date where you’ll dedicate the entire day to “dealing with every aspect of your money.”
Orman emphasized that it’s not so much about what you’re invested in, but rather how your finances are organized.
“Is everything in place? Are you protected in case something happens?” she asked.
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4 Key Financial Initiatives To Do Before 2025
Here are some key initiatives to consider when you make a date with your money.
Check Your Homeowners or Renters Insurance Policies
Be sure to check all your home or rental insurance policies to see what they do and do not cover.
For example, have you increased the coverage of the policy since the value of the home went up? If your home is worth more today because its value has appreciated over time, you’ll likely need more homeowners insurance coverage. Have you acquired more expensive belongings in your rental apartment? If so, you may need more renters insurance coverage.
Be Sure You Have Enough Homeowners Insurance Coverage To Cover Natural Disasters
As a result of recent natural disasters and the effects of inflation, materials to rebuild homes now cost more than they used to. Does your insurance policy cover all the replacement costs associated with building materials?
Also, do you have flood insurance? Most homeowners insurance policies don’t automatically include this coverage, but it’s important to add it on — especially if you live in or near a flood zone.
Review Retirement Plans, Life Insurance Plans and Your Health Savings Account
It’s crucial to check up on all of your retirement and life insurance plans. Additionally, don’t forget to check your health savings account. The reason? You’ll need to keep all your beneficiaries up to date.
For example, if you get divorced, you probably don’t want your ex to inherit your retirement account after you pass, Orman pointed out.
Check Credit Card Interest Rates
Take some time to check interest rates on all your credit card debt. No matter the interest rate, you’ll never get ahead if you only pay the minimum. Orman said, “Debt is bondage.”
She suggested taking these steps:
- Write down all your credit cards, the interest rate you’re currently paying on each of them, the balance due on each of them and the minimum payment due on each of them.
- Then, arrange them from the highest interest rate to the lowest interest rate.
- From there, pay at least $100 per month more than the payment you’re making on the highest-interest credit card.
- Once that card is paid off, roll that monthly payment, plus the additional $100 per month, over to the next highest-interest credit card.
By eliminating credit card debt from the highest to lowest interest rate, you’ll save money in the long run and prevent your debt from snowballing further.
She also recommended opening a 0% intro APR credit card with a low balance transfer fee. By doing so, you can pay off your debt and stop more interest from accruing. Just be sure to pay off your debt before the 0% intro APR period ends.
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This article originally appeared on GOBankingRates.com: Suze Orman Says You Need To Do This With Your Money Before the New Year
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