5 Ways to Take Control of Your Finances in 2009

Resolutions 2009

With the economy taking us on the ride of the century and 2009 right around the corner, taking control of your personal finances should be at the top of your list of New Year’s resolutions. Whether you are planning on changing jobs, paying off a loan, buying a new home, starting a business or even just taking a vacation in the next year, it’s essential to have the necessary funds to meet your goals. That means taking the time to sit down to review your current financial situation and taking some steps to keep your finances organized and, most importantly, protected. But don’t despair – financial planning doesn’t have to be a chore! Here are some simple tips to help you take a new, proactive approach to managing and protecting your finances for the New Year:

1. Set a budget. What’s your current ratio of income versus expenses? If you don’t know, then your first step in taking charge of your finances will be to figure out what your fixed and variable costs are each month, and compare them with your net income. Some expenses can’t be changed, but others can be, and having a handle on how much you can spend will help you to stay within the limits, so that you don’t get in trouble with overextended credit. Having a budget doesn’t mean that you can’t enjoy life – it just means that sometimes you need to stretch out the timeline on your purchases.

2. Have sufficient cash reserves on hand. Most experts recommend having at least 6 months worth of income set aside for emergencies. In order to save money, reduce spending in unnecessary areas — this will also reduce your reliance on credit and ease the burden on your investment assets.

3. Know Your Scores. Most everyone is familiar with a FICO score used throughout the world to assess credit risk. FICO scores are available through all of the major consumer reporting agencies and to find out what your FICO score is, order your credit report from one of these agencies. You are entitled to receive a free credit report from each of the big three credit-reporting agencies (Equifax, Experian, and TransUnion) once per year, and can order it from the official credit reporting Web site at www.annualcreditreport.com. Now there is another important score that everyone should know — your risk for identity theft. In tough economic times, many experts predict a rise in identity theft – now the #1 crime in America. In the last year, over 200 million Americans had their identities compromised and new victims of identity theft happen every 2 seconds. Understanding your risk is critical in these economic times. With the introduction of their IdentityThreatScore by TrustedID, you can get your score –assessing your risk for identity theft. It will outline your individual risk profile and determine immediate next steps that should be taken for prevention. Learn more at www.trustedid.com.

4. Protect What’s Yours. In addition to assessing your risk of identity theft, take proactive steps to prevent it. Avoid giving out your Social Security Number if it’s not absolutely necessary. Shred mail that contains account information or new credit card offers before throwing it in the garbage, and avoid carrying bills, your Social Security Card, or other personal information with you, especially if you are traveling. If you bank online or store personal information on your laptop, it would be wise to change your password at least once a month and try to select passwords that will not be obvious to potential hackers (birthday, anniversary, pet name, etc.). Always use firewall, virus and spyware protection software that you can update regularly like Norton Internet Security 2008: http://www.norton-security-store.com/. This will protect your computer from spyware, which can collect many different types of personal information, including passwords and credit card numbers. Only download free software from sites you know and trust. For comprehensive protection, consider signing up for an identity theft protection service.

5. Grow Your Worth. In order to increase the value of your investments, most experts recommend building a diversified investment portfolio. Before investing, review all of your investments carefully and evaluate the long-term viability of each. Make sure that your financial assets are spread out, to ensure that you are not overexposed to any particular segment of the market. If you invest in mutual funds, make sure that you invest in different securities within the same asset class, such as stocks, bonds, and cash equivalents. Diversifying within an asset class can help smooth out the returns within a particular sector of your portfolio.

Contacts

Atomic PR
Jessica Lewinstein, 415-402-0230