Resolved:
I’m going to save more money, pay down my debt,
check my credit report, improve my job prospects
and review my life insurance. For those too lazy
to come up with their own financial resolutions
for the new year, these are the recommendations
of consumer experts from around the country.
SAVE
MORE
Greg
McBride, senior financial analyst, Bankrate.com,
a publication of Bankrate Inc. in West Palm Beach,
Fla.:
“The
biggest barrier to saving is not getting into the
habit of saving. To start, pay yourself first by
setting up direct deposit from your employer or
your checking account into a high‑yield savings
account. Establishing a budget and tracking expenses
against your income isn’t just a spending strategy,
it is also a savings strategy. Once you know where
your money is going, you can identify opportunities
to further boost savings by trimming expenses. Make
sure you take advantage of a high‑yielding
money market or savings account, where yields still
top 5 percent, instead of letting whatever savings
you have pile up in your current bank, where yields
are often below 1 percent.’’
DEAL
WITH DEBT
Daniel
A. Mica, president and chief executive of the Credit
Union National Association, headquartered in Madison,
Wis.:
“There
is no such thing as ‘good’ debt or ‘bad’ debt. There’s
just debt. The way to get rid of it is to pay off
the balance carrying the highest interest rate first,
and that’s generally a credit card. Then work your
way down to the balance with the next highest rate.
“Since
we’re credit union people, we believe in making
it a positive experience. That is, do something
that reinforces that you are paying down debt. Say
you’re going to pay off a card and tighten your
belt for five months so you can squeeze out an extra
$100 a month toward the debt. In the sixth month,
spend at least a part of that $100 on something
enjoyable to reward yourself for what you’ve done.
Next month, start in again.’’
GET
THAT FREE CREDIT REPORT
Paul
Richard, executive director of the nonprofit Institute
of Consumer Financial Education in San Diego, Calif.:
“Since the fall of 2005, consumers nationwide have
been
eligible
to obtain a free copy of their credit report every
year from each of the three main credit reporting
agencies: Equifax,Experian and TransUnion. There’s
a Web site, www.annualcreditreport.com, but we recommend
that people call the toll‑free number,
(877)
322‑8228. That’s because there are about 50impostor
Web sites out there, most of them selling subscriptioncredit
services, so it’s important that people who want
to use the Web site type the name correctly.
“We
suggest that people order a different one every
four months. That way you’re checking your credit
year‑round. If there are mistakes or inaccuracies,
notify the credit bureaus right away. They could
be depressing your credit score, which means you
may be paying more to borrow than you should. Also
look for suspicious activity. It could be an early
sign of identity theft.’’
IMPROVE
YOUR JOB OPPORTUNITIES
John
A. Challenger, chief executive of the Challenger,
Gray & Christmas Inc. outplacement firm in Chicago:
“Many people find that when they change jobs, whether
voluntarily or involuntarily, they locate their
new positions through people they’ve gotten to know,
acquaintances they’ve developed. You can’t expect
to stay at one company all your life and rise up
the ladder like people used to.
“So
go out and join industry professional organizations
or alumni associations and get engaged. It’s such
important career insurance, a way of expanding your
Rolodex. Vow to spend 5 to 10 percent of your time
working at building relationships in different communities
you could be engaged in–your church, charitable
group, professional associations. It may not sound
important, but it really is.’’
REVIEW
YOUR LIFE INSURANCE
Neal
Sullivan, secretary‑treasurer of the board
of the Independent Insurance Agents and Brokers
of New York: “If you have a policy and it’s more
than a few years old, sit down with your agent and
look it over. The rates on life insurance have come
down drastically over the past couple of years,
so you probably can get more insurance for the same
amount of money, or the costs will go down for the
amount of coverage you have.
“How
much do you need? Everybody’s situation is different.
A lot of new homeowners want enough to protect the
family in case something happens, so they get enough
to at least cover their mortgage so the spouse and
the remaining family members won’t be kicked out
of their house. That’s kind of the baseline.
Obviously,
you probably need more than that if you have kids,
want them to go to college, things like that.
Don’t
think that being single means you don’t need insurance.
Just to have a funeral and be buried is expensive,
so you should have coverage for that.’’
