Top Things to Do

Here are seven action items:

1. Set financial goals.
2. Create and follow a spending plan (budget).
3. Create an emergency fund.
4. Review insurance needs.
5. Minimize or avoid credit card debt.
6. Save and/or invest at least 10% to 15% of your gross pay.
7. Seek professional advice from an attorney specializing in estate planning.

Review Your Financial Situation

Answer the following questions to get a sense of your current financial readiness. (Hint: Hopefully you are able to answer, “yes” more than, “no” or “I don’t know.”)

• I know my short-term, intermediate-term and long-term financial goals.
• I understand my financial resources. I have calculated my net worth.
• I follow a spending plan for managing my income and expenses.
• I target at least 10% to 15% of my gross pay for savings/investments each pay period.
• I have an emergency fund with at least three to six months of my basic living expenses.
• I use credit wisely. I pay my balances in full each month. I limit my open lines of credit.
• I know my credit score and the information contained within my credit report.
• I check my credit report at least annually for accuracy.
• I understand my consumer rights and take steps to ensure my credit rating is accurate.
• I am investing for retirement by contributing to tax-advantaged accounts.
• I am familiar with the federal income tax advantages of IRAs and other plans.
• I am familiar with my options for investing for education.
• I am familiar with basic investing concepts.
• I have purchased appropriate auto insurance coverage for my vehicles.
• I have purchased renters insurance to protect my personal property — if you do not own a home.
• I have insured my home for its complete replacement value — if you own a home.
• I, and my spouse, have appropriate life insurance for our situation. Neither of our deaths would create a financial burden for our family.
• I understand my TRICARE health coverage benefits.
• I, and my spouse, have prepared and executed wills, powers of attorney, and letters of instruction as appropriate. We update them regularly to prevent court delays in the settlement of our estates and other important matters after our deaths.