13 Smart Financial Steps to Take in 2013

So let’s not call these “New Year’s Financial Resolutions.” Instead, here are 13 smart financial steps that you can take to help get and keep your finances on track in 2013:

1. Establish a budget.Many people bristle at the mere mention of the “B” word: budget. But budgeting is the first step in gaining control of your finances—and it usually isn’t as difficult or painful as most people think.

2. Reduce your debt.Excessive debt is one of the biggest obstacles to financial security and independence, as well as to saving for a financially secure retirement. So begin planning now to pay down your outstanding debt as soon as possible.

3. Control your credit card spending.Credit cards are the biggest debt challenge for many Americans. If they are a big temptation for you, cancel them and only use cash and debit cards to pay for all future purchases.

4. Build an emergency fund.Some financial advisors recommend saving anywhere from three to six months of living expenses or more. The money should generally be kept in a liquid savings account (like a bank account or money market fund) that can be accessed easily to cover unexpected large expenses.

5. Increase retirement plan contributions.If you are saving money regularly in a qualified retirement plan, congratulations! Your next challenge is to increase your contributions—ideally, until you’ve reached the annual contribution limit for your plan. See if you are on track to meet your retirement goals with an online retirement calculator. David Lerner Associates offers a free, comprehensive calculator at www.davidlerner.com/retirement-calculator.aspx.

6. Think about long-term care.You may want to consider purchasing long-term care insurance to cover major healthcare and nursing home costs after you retire. This will depend on such factors as your age, how much you’re saving for retirement, and whether you will have retiree healthcare coverage from your employer.

7. Check your credit.You can get one free credit report each year from each of the three major credit reporting bureaus (Equifax, Experian and TransUnion) by visiting www.annualcreditreport.com. By ordering a free credit report from each bureau every four months, you can carefully monitor your credit all throughout the year.

8. Protect yourself from identity theft.Identity thieves can wreck havoc on your financial life in no time. Be extremely careful not to inadvertently share personal information like your Social Security number or online banking logins or passwords with identity thieves, especially if you receive suspicious emails asking for this.

Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. (DLA). This material does not constitute an offer or recommendation to buy or sell securities and should not be considering in connection with the purchase or sale of securities. Member FINRA & SIPC.