We’ve all been there. We’ve had endless to-do lists, only to put them to the side, never to be seen again. I’m sure this happens in all areas of life, not just finances. However, I want to focus on the financial loose ends that may be holding you back. Keep putting things on the back burner, and you’re going to regret it! I’m sharing 5 financial loose ends to tighten up immediately, so you don’t have to worry about them again.
Financial Loose Ends to Tighten Up Immediately
#1 Rolling over your 401k
Many people change jobs over the course of their careers. If you had a retirement plan with a previous employer and did nothing with it, it’s likely your money is just sitting there. Sorry to say, but your retirement plan doesn’t roll itself over. You have to take proactive steps to rollover your 401k into your new employer’s plan.
While this may be a pain in the butt, it pays off in the long run. When you combine your money, you’re much more likely to see higher gains. Basically, the more money you have, the more opportunity it has to grow on top of itself. If this is an outstanding financial loose end, it’s time to tighten it up now. If you don’t know where to start, contact your current retirement plan provider and they’ll provide you with the next steps.
#2 Settling past due debts
Another financial loose end that can hurt you, in the long run, is not settling past due debts. This would include things like collection accounts or outstanding money owed to family or friends. If you’re not sure if you have collection accounts, you’ll want to check your credit report.
Thankfully, consumers get one free credit report poll each year by each of the three credit bureaus. Take advantage of this, so you can see if there any past due debts showing on your report. If there are past due debts showing, the updated collection agency information should be available. Visit www.annualcreditreport.com to get your annual credit report pull!
If you owe money to family or friends, it’s time to square up that debt. Not only do you want that debt hanging over your head, but you also want to be true to your word. If you told your family member or friend that you were going to pay this debt off, you need to do so.
Don’t be afraid to ask for a repayment plan, or save for the money yourself. Just make sure you let them know that you’re working on it and will get this debt paid off as soon as you can. If you’re reading this and you have money owed to you from a family member or friend, check out The Do’s and Don’ts of Loaning Money.
#3 Getting life insurance (if applicable)
Do you have people that rely on you financially? What would they do if something were to happen to you? If there are people you support financially and they would be in trouble if you passed away, you want to get life insurance. This will help ensure they can move on financially.
Depending on what stage of life you are in, you may not need life insurance right now. That does not mean you won’t need it in the future, so make a note to always come back to the question of if you need it or not. Not sure if you need life insurance right now? Read the article Why You Need Life Insurance Right Now to help you decide.
#4 Understanding your employee benefits
Are you taking advantage of all of the benefits offered to you by your employer? If not, that’s a financial loose end you’ll want to tighten up immediately. Not only are employee benefits there to help you financially, but they can also help you in a variety of other ways as well.
Some companies offer free life insurance. Other companies allow a certain number of therapy sessions. Most companies offer some sort of commuter benefits, tuition reimbursement, or child care expense assistance. Do your research and take advantage of the benefits available to you. Even if you don’t need the specific benefits right now, it’s nice to have them in your back pocket for the future.
Adding on to this loose end, make sure you understand your current medical coverage. What’s covered? What’s not covered? What are your co-pays? When you’re young, you don’t visit the doctor much. As you get older, these costs will start to become more important. The sooner you know, the sooner you can plan accordingly.
#5 Creating a will
The last financial loose end you’ll want to tighten up immediately is creating a will. If you are in a position where you have assets, you’ll want to have a will that lays out what happens to those assets should you pass away. Most people think they have to be old or rich to have a will, neither is true.
The minute you start accumulating wealth for yourself, even if it’s small right now, you’ll want to create a will. This will help make sure that things go exactly as you want them to if you were to pass away. Check through your employer first, they may have lawyers dedicated to creating wills. If that employee benefit is not available, seek out your local estate lawyer. Read Estate Planning for Millennials for some more information.
At the end of the day, you always want to set yourself up for success. Taking care of these financial loose ends, and any others that’s lingering, will help you do that! You’ll also feel a mental weight lifted off your shoulders! Do you have any financial loose ends to tie up? Drop a comment below to share what they are, or your tips for handling them!