Quick Tip:

Review your investment portfolio
Check your asset allocation at least once a year. Changes in the performance of your investments could mean you need to rebalance your investments in line with your goals and tolerance for risk.






Easy Steps To Improve Your Net Worth
By Suzanne Martin

Handling personal finances often takes a back seat to the daily rush of running a small business. And the job can feel overwhelming when you begin to consider long-term goals, debt reduction, retirement funding, college educations and all the other pieces of the personal financial puzzle.

Mark B. LaPlace, CPA and chair of the executive board of The Ohio Society of CPAs offers this suggestion – break down the improvements you want to make into manageable tasks. Here, he outlines how you can approach your personal finances in an easy-to-follow fashion.

       
Pay down your debt
If you’ve run up large credit card bills, your first financial resolution should focus on paying down your debt. Review the interest rate and terms on outstanding loans and credit cards to identify opportunities to restructure debt at more favorable terms. Then, work out a realistic repayment plan and stick to it.

Set long-term financial goals and save for them
Whether establishing a college fund for your children or planning the vacation of a lifetime, concrete objectives form a solid foundation for achieving your goals. Prioritize your list of goals. Assign your top goals a dollar value and a target date. Use an online calculator to determine how much you need to save each month to achieve your goals. Then devise a specific plan for doing so.

Prepare your taxes early
To avoid last-minute income tax-filing panic, begin gathering tax-related receipts and documents early. The further ahead you plan, the more you’re likely to save. Make an appointment with your CPA or a tax adviser to help develop strategies that will minimize your tax liability.

Fund your retirement
Be aggressive in funding your retirement. Make regular contributions to a traditional Individual Retirement Account (IRA) for tax-deferred savings. Or look into a Roth IRA for tax-free retirement distributions. If your small business doesn’t have a SEP, SIMPLE, 401(k) or other plan, investigate which would be most beneficial for your company.

Automate your savings
Pay yourself by saving money regularly. You can often arrange for your bank to make automatic deposits to your investment account.

Review your investment portfolio
Check your asset allocation at least once a year. Changes in the performance of your investments could mean you need to rebalance your investments in line with your goals and tolerance for risk.

Check insurance coverage
Review your home, business, health, car, life and disability policies to determine whether there are any gaps in coverage. Talk to your agent to see if you may be able to obtain more effective coverage by increasing or reducing deductible amounts on your policy. Also inquire about any discounts that may be available for taking special safety precautions such as adding an alarm system to your home or car.

Get organized
Organize important financial papers and legal documents. Also consider investing in computer financial software that can help you keep track of your finances and monitor your progress.

Prepare or strengthen your estate plan
An estate plan should include a will. It’s also important to consider a durable power of attorney, a living will, and living or irrevocable trusts. You should also review how your property is titled as well as investigate what measures you can take to minimize estate taxes and probate costs.

Know your net worth
Add up all your assets (what you own) and subtract the total of your liabilities (what you owe) to determine your net worth. By doing this each year, you can chart your progress and watch your assets grow.

Take advantage of year-end tax savings strategies
At the end of each year, make charitable contributions. Consider whether it makes sense to offset capital gains with capital losses. Plan to delay income and accelerate deductions.

Learn more about personal finance
Read books and magazines about personal finance. If you stick to reputable sources, you can also find excellent financial advice sites on the Internet.