Your January Financial To-Do List

How can you get in the best financial shape at the start of the year?

Ruth Saldanha 21 January, 2021 | 4:38AM
Facebook Twitter LinkedIn

 

 

Ruth Saldanha: Welcome to Morningstar. I'm Ruth Saldanha. Today, let’s discuss your January financial to-do list. January is dull. The holiday season is behind us, and the worst of winter lies ahead. Plus, this is around the time when the bills from December start coming due.

It isn’t fun to think about money right now, but honestly, this is the best time to do it! So let’s get started.

Morningstar director of personal finance Christine Benz recommends you start with a financial wellness check - a big picture read on how you're doing. Figure out what you have, what you owe, and where you’d like to be. You also need to make sure your money is working for you. Christine recommends you look at all your short-term goals, and loans – this includes your mortgage, or student loans, or high-interest-rate credit cards, and then think about the return on investment from each of these capital deployments

In simple language, this means if you’ve got a large outstanding balance on your credit card, it’ll be really hard for you to earn more in returns, than you end up paying out in interest. Paying down credit cards is the best way to deploy capital. But if that's not possible for you, tackle the card with the highest interest rate first, because that's going to rack up the biggest charges.

Finally, keep an eye on upcoming renewals – and where possible negotiate. For instance, look at your phone plan, your internet plan, your bank charges, and your insurance. Before you pay them off, shop around. Make sure you get the best possible deal before you pay it off.

That’s the plan for January – good luck, and we’ll see you again next month!

Get the Latest Personal Finance Insights in Your Inbox

Sign Up For Our Newsletter Here

Facebook Twitter LinkedIn

About Author

Ruth Saldanha

Ruth Saldanha  is Senior Editor at Morningstar.ca. Follow her on Twitter @KarishmaRuth.

 
 
 

© Copyright 2021 Morningstar, Inc. All rights reserved.

Terms of Use        Privacy Policy        Cookies