By: Brook Ptacek, Investor Advocacy Clinic Spring 2019 Student Intern
In mid-January, FINRA staff posted an Investor Alert about a 2019 Resolutions Reset. In the article, FINRA goes through six tips to make sure 2019 is “your strongest financial year yet.” Those are some bold words, but the advice FINRA provides is valuable.
The six tips FINRA provides include: (1) evaluate your spending plan or budget; (2) set new goals; (3) check your credit report; (4) rebalance your portfolio; (5) zero in on fees; and (6) free yourself of financial clutter.
To have the strongest financial year yet, FINRA suggests that you should first evaluate your spending plan or budget. According to FINRA’s Investor Education Foundation’s National Financial Capability Study, if you budget, you’re more likely to spend within your income. FINRA even gives you tips on how to create a budget.
FINRA then continues that you should set new financial goals for the year—like adding more to your 401(k) or IRA than you did in 2018. FINRA suggests set a financial plan for 2019 with both short-term and long-term goals and provides insight about what some of those goals might look like.
Third tip from FINRA to ensure 2019 is your strongest financial year yet is check your credit report. Beyond pointing you to AnnualCreditReport.com to check for yourself, FINRA provides info about the sort of things that can hurt or help your credit score.
Fourth, FINRA suggests you should rebalance your portfolio. FINRA defines “rebalancing” as restoring the asset allocation in your portfolio to maintain your desired risk level. Essentially, FINRA suggests shifting your investments around so your portfolio is more diversified.
The fifth tip to make sure you’re on top of your game in 2019 according to FINRA is zero in on fees. I want to emphasize this tip because it points out something that can easily be overlooked when you’re investing: the fees it costs to invest in the first place. FINRA points readers to their integrated Fund Analyzer tool to calculate the potential fees and expenses you can see on your specific investments.
Lastly, FINRA says tap into your inner chakras and free yourself of clutter—financial clutter that is. FINRA suggests to have the strongest financial year, get rid of those old bills and receipts you no longer have use for and provides a guide to help determine whether to save or shred.
The six tips FINRA provides are valuable nuggets of advice to help you have the strongest financial year yet. Even if financial stability was not one your resolutions this year, just know it’s never too late to make it one.