Summer vacation is the time to relax with family, reconnect with friends and make new memories for both the young and the old.
For Baby Boomers near or in retirement, this halfway point to the end of the year is also a great time to re-evaluate your financial portfolio to assure you are meeting your goals (and make tweaks if you are not).
“Hitting the halfway point of the year is a great time to give your finances a check-up,” says Christine G. Russell, senior manager of retirement and annuities for TD Ameritrade. “Investors who get into the habit of reevaluating their investments mid-year have the opportunity to make necessary adjustments and be better prepared heading into the second half of the year.”
Russell discussed with FOX Business what you need to know about conducting a mid-year financial check-up.
Boomer: What should I be doing to maximize the potential interest on my savings account?
Russell: Interest rates are still at historic lows in the aftermath of the financial crisis. While some borrowers have benefited from low interest rates on mortgages and auto loans, savers have been grappling with rates well below one percent. If you already have a sufficient emergency fund and are saving for something further down the road, it may make sense to consider a diversified portfolio of investments that suits your time horizon and risk tolerance.
Boomer: Should I update my W-4?
Russell: Those who have had a major event occur in their lives since the beginning of the year, such as a marriage, divorce, or newborn child, should update their W-4 form. Similarly, it may be beneficial to update a W-4 if an individual decides to take on a second job to earn some extra cash. Events like these will impact an individual’s taxes when they file their 2017 returns next year. While some people grow accustomed to receiving a refund each spring, experiencing a life change can cause and individual to owe money come April. However, those who have qualified for additional deductions can see the size of their refund increase, leaving them with a fatter check. It is important to be proactive about your tax filings to avoid the surprise of owing Uncle Sam money or being forced to wait for a large refund when you could have been seeing that money in your paycheck.
Boomer: Is it important to review my credit report mid-year?
Russell: Yes. Checking your credit report provides important benefits for individuals. Monitoring your credit report regularly will allow you to check your financial progress, spot possible discrepancies and even find instances of identity theft. It is important for individuals to stay informed of changes to their credit report and monitor their credit history so they can work to improve their score during the remainder of the year or contact the credit bureau if there are potential issues before they become major problems. Mistakes and fraud both happen. Stay alert.