Summer Financial Check-up
With the first half of the year behind us and summer in full swing, I find this time of year to be a great opportunity to do a mid-year check-in with my finances.
Most of us spend more time in our house during the summer since it is too hot to go outside. In lieu of binge watching a new series, consider doing some reconciliation accounting, and sleuth in your accounts to make sure you are not paying for services you are not using anymore!
Here are 10 often overlooked items that can have a substantial impact on your wallet:
#1 Check your tax withholding: Look at your pay stub to make sure you’re on track. If you’re not sure, use the IRS online tax withholding calculator to see if you are over or under. All you need is your most recent pay stub(s) for your household, other income information (side jobs, self-employment, investments, etc) and your 2025 tax return; hopefully you filed those already! https://apps.irs.gov/app/tax-withholding-estimator
*Results are as accurate as the information you enter.*
#2 Boost your retirement savings: Review your 401(k) or similar plan - TSP, 403(b), 457, etc. Make sure you are not leaving any “free” money on the table by missing out on your employer’s match - check with HR if you’re unsure. A financial professional can help calculate how much you are saving, and if it is enough for your future. Remember, tax-deferred savings reduce Federal taxes, so it may be beneficial to review the math to meet your long-term savings goals.
#3 Review your life insurance policies. Are they in-force? About to expire? Sufficient to provide for your loved ones? Maybe you just realized you do not have life insurance or are unsure if you even need it. Life insurance helps the people who depend on you to replace lost income and help pay off any debts such as a mortgage, student loans, or medical bills. It can also potentially be used as a tax-free gift to your beneficiaries to help pay taxes on a large inheritance from an IRA. Check the death benefit amount, as most people have smaller policies when they are younger and do not realize they can add or stack term life policies as they age to increase death benefits for their loved ones.
#4 Speaking of insurance…it’s monsoon season! Now is a great time to review your homeowners and car insurance policies. Are the coverages adequate? Do you have a teenage driver…do you have an umbrella policy? Most policies we see are leaving the clients underinsured. Medical payments of $1,000 from a typical homeowner’s policy might get you to the front desk of the E.R., but that’s about it. What if you are in an accident and there is property damage other than to a vehicle? Better get those tire treads checked while you are at it, the road is slippery when wet! How well is your vehicle maintained? Summer road trips are great, but you still need oil changes, belts, hoses, brakes and all of the other important components. Unfortunately, our desert climate takes a heavy toll on anything made out of rubber, but your tires are the only part of your car that touches the road and replacing them is far cheaper than paying for an accident!
#5 Attack your debt. Have debts like a car loan, student loan, or credit cards? Check the terms to see how many payments are left. Oftentimes you can reduce the length of payments and shorten the loan by paying more each month. This also saves you interest that goes back to your account! If you paid off your car recently, make sure you inform your car insurance company as sometimes your insurance will actually go down since the lien is gone.
#6 Audit those subscriptions: Check your bank statements and credit card statements for recurring charges and forgotten subscriptions. Gym memberships, streaming services, food delivery fees, and apps you haven’t used in months are easy targets to cancel.
#7 Refill your emergency fund: If you (or inflation) dipped into your savings earlier this year, make a plan to refill the kitty by December, so you can start the new year with new goals. Don’t carry 2026 into 2027!
#8 Make your cash work harder: If your emergency savings are sitting in a standard account earning pennies, consider a High-Yield Savings Account and/or a CD. Your emergency fund should always be liquid in cash in a High Yield Savings Account. CD’s are another option for cash you won’t need for a while. Check for FDIC insurance at the Financial Institution to insure your deposits.
#9 Plan for college: The kids may be out of school for the summer, how many years do they have until high school graduation? 18 years goes by in the blink of an eye. Consider a college savings account, such as a 529 or Coverdell ESA. We are also experts in those, but don’t wait until their senior year to put together a plan! Prior to investing in a 529 Plan investors should consider whether the investor's or designated beneficiary's home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in such state's qualified tuition program. Withdrawals used for qualified expenses are federally tax free. Tax treatment at the state level may vary. Please consult with your tax advisor before investing.
#10 Update your estate plan: When was the last time you reviewed your documents for accuracy? Hopefully they were created in Arizona, and not in a different state, as state law differs and is not universal. Did you list a relative you no longer trust or have new family members such as a grandchild to consider? Are your accounts properly titled and the beneficiary designations correct? Not having an estate plan can be a costly mistake, as probate may need to be filed, which is expensive. Not to mention attorneys fees and the length of time to go through probate. As well, we have seen good intentions on DIY documents, but working with a professional can ensure it is up to date with current law, as well as taking tax planning into consideration. For example, would you rather have a full step-up in basis or half on a valuable asset?
Need help staying on track? Consider our Financial Planning Program! A strong planning process is one of the best ways to enhance your long-term financial independence. It is crucial to create a financial plan which seeks to protect your needs now, while also strategizing for the future, in a tax-efficient and thoughtful manner. Regularly reviewing your financial plan is important for long-term success.
Advisory services are offered through Five Speed Financial Planning LLC, d.b.a. Schulz Financial Group, a SEC Registered Investment Advisor. All content is for information purposes only and is not intended to provide any tax or legal advice or provide the basis for any financial decisions, nor is it intended to be a projection of current or future performance or indication of future results. Please consult with a qualified professional for advice tailored to your individual circumstances.