Quarterly Financial Review Checklist

Rebecca Lake

Reviewing your finances on a regular basis is critical to ensuring the success of your financial plan. But, how do you know what you should be looking for, and how often should a financial review take place?

While it’s a good idea to take a look at where you are financially at least once per year, executing a quarterly financial review can help you stay more in-tune with your money and your goals. If you’re not sure what to give your attention to, use this helpful checklist as a guide.

1. Start with Your Credit Report and Score

Your credit report and score are two of the most important pieces of your financial health puzzle. A good credit score and an established credit history can make it easier to obtain loans when you need them, and enjoy favorable interest rates on what you borrow.

As part of your quarterly financial review, take time to look at your credit report. It’s best to check your reports from all three major credit bureaus if possible, since Equifax, Experian and TransUnion don’t always include the same information in your reports.

You can obtain your credit reports for free through AnnualCreditReport.com. Alternately, you can get both your credit report and score through a free credit monitoring service, such as Credit Sesame or Credit Karma.

Here’s what to look for as you review your report:

(1) Check that your personal information is accurate and up-to-date

(2) Review the current balance and payment history for each account

(3) Look for any new accounts that have been opened or inquiries for credit, which could be signs of potential fraud

(4) Check for any negative remarks, such as late payments, collection accounts or public judgments

(5) If you spot an error or inaccuracy, contact the credit bureau reporting the information to dispute it

2. Move On to Your Budget

A budget is highly useful for keeping spending in check and working towards your savings goals. During your quarterly financial review, go over your monthly spending line by line. Look for expenses that have increased or decreased, or new expenses that have been added in since the last quarter.

Next, review your income. Are you making more money, less money or the same amount? If your income has increased and your expenses have gone down, that means you have more money to apply to debt repayment or save. On the other hand, if your income has stayed the same but your expenses have increased, you may need to review your spending to see if there’s anything you can reduce or eliminate.

If you have debt, look over your current debt repayment plan. Ask yourself whether you’re still on track to pay your debt off by your target deadline. If you’re reducing any expenses or your income has grown, consider whether you could increase your monthly debt payments to wipe out your balance faster.

3. Take a Second Glance at Your Investments

The stock market is volatile and sometimes, your investments may see more dramatic up or down movements than others. Including a portfolio check-up as part of your quarterly financial review can help ensure that you’re still maintaining the appropriate asset allocation, based on your risk tolerance.

You should also be reviewing the fees you’re paying for your investments each quarter. Higher fees can significantly diminish returns and the impact can be felt even more deeply when the market experiences a downturn.

If you’re conducting your financial review in the fourth quarter, you may also want to think about harvesting losses in your portfolio to offset any gains you had over the year. Tax loss harvesting can help to minimize the tax impact of reporting capital gains from your better-performing investments.

4. Check Your Insurance Coverage

You need insurance to cover your home, your car, your life and your health but that doesn’t mean you have to pay more for it than you need to. Once per quarter, review your coverages amounts, premiums and deductibles. Consider whether you may be eligible for any discounts on coverage that you’re not taking advantage of, or whether you could reduce your premiums by raising your deductible.

Also, look for any gaps in your insurance plan. For example, if you’ve recently gotten married or welcomed your first child, it may be time to think about getting life insurance if you don’t have that already. Life insurance can provide a financial benefit to your surviving spouse to pay off debts, cover monthly expenses or help with the cost of raising children if you pass away. 

5. Review Your Retirement Plan Contributions

The sooner you begin planning for retirement the better and your employer’s plan can be a great way to start. If you’re saving in a 401(k) or similar tax-advantage plan at work, review your contributions each quarter to get an idea of how much you’ll contribute for the year. If you’re not on track to max out the annual contribution limit, consider adjusting your contribution rate to get closer to the mark.

A traditional or Roth IRA is another way to save in addition to your employer’s plan, or in place of one if your job doesn’t offer a 401(k). If you have yet to open an IRA, take time to review your options and your budget to determine how much you could afford to save in one of these accounts each year.

 

6. Update Your Goals

Setting goals can be a great motivator to save and be more efficient with your spending. The final piece of your financial review is checking in with your goals each quarter to see how much progress you’ve made. If there’s a goal you can cross off your list, think about what new goals you can set as you continue to develop your financial plan.