Top 11 Financial To Do’s

Each year I’m given the privilege of speaking with several groups of recent college grads about personal finance.  It’s no secret that even after 4 years of high school and several years of college (and perhaps beyond) most people enter the complex world of personal finance unprepared.

I hope my talks encourage those folks to make a few really good decisions about money right out of the gate.  That way they’ll set themselves, and their families, up to be much more financially successful.  Not just for the sake of more dollars but to increase their chances of having a healthier marriage, worrying less about money and having the resources to make an impact on their community and the world.

During each of my talks I present the audience with my Top 11 Financial To Do’s list.  It’s basically a check list of 11 important financial things that I believe every young person should consider when starting out.  Yes, 10 To Do’s would have been more satisfying but I just couldn’t cut one – sorry David Letterman!

As I was preparing for one of my talks just before Christmas, I was thinking about how many items on my list apply not only to young people but also to those of us that are half way through our careers or even retired.  With that in mind, and with this being the season of new beginnings and New Years’ resolutions, I thought I’d offer my Top 11 Financial To Do’s list for your review.  Perhaps you’ve been involved with your personal finances for years and you’ll be reminded of a thing or two you need to tackle in 2020 or maybe you’ll forward this on to one someone you love that is just getting started.  Either way, please let us know how we can help.

  1. Discover your money story and tell it to your spouse or a friend. And ask about theirs. The things we experience and learn about money early in our lives directly impact the way we think and feel about money today. A good place to start is with the question “What was money like growing up, for me?”
  2. Know where your money is going. Create a spending plan (aka budget.) Many people find it easiest to use online software like Mint or  YNAB but others appreciate Quicken or even Excel.  Start by simply figuring out what you’re spending.  Then check to see of your spending is aligned with your priorities?
  3. Establish an emergency account. A good guideline is 3 months expenses if you’re a dual income household and 6 months if you’re single income.  You might increase those numbers if your income is particularly uncertain.  Park the money in a FDIC insured, online savings account or at a good credit union.  As of this post you should be able to earn close to 2% interest on your stash.  This could also be a good place to save for upcoming purchases like a new car or down payment on a house.
  4. Give. OK, this one is personal but so is money in general.  Money comes with all kinds of pathologies and I believe that one of the few ways to  break the hold that money has on all of us is to give it away.
  5. Pay off debt. Less debt is almost always better especially when it comes to credit card or other consumer debt. If you have student loans or a mortgage then let’s talk.  For more than one loan pay off the highest interest rate loan first (or smallest balance to highest if that feels more motivating.)
  6. Put the appropriate types of insurance in place. Health, disability, life (probably term), homeowners or renters, business or professional and auto.  What about an umbrella policy that provides liability insurance coverage beyond the limits of your home or auto coverage? – they are inexpensive but important.
  7. Plan for your goals – What’s important to you? If you’ve followed us at Beacon long enough you know we like to talk about the importance of having a financial plan.  Many of the items in this list will raise questions that can best be answered via a good financial plan.
  8. Save. Put it on autopilot, if possible, and pay yourself first. The amount you save, what type of account you use and how you invest it will be determined by the purpose of your savings dollars.  See #7.
  9. Invest well. Have a well thought out, evidence-based investment philosophy that you feel confident about.  The best investment plan in the world is worthless if you can’t stick with it in good times and in bad. Hopefully, your plan will minimize investment costs, taxes, unnecessary risk and behavioral mistakes.
  10. Check one of your credit reports annually. Use Annual credit not free credit  And make sure to do so prior to big purchases like a car or a home. Credit reporting errors and credit theft happens so it’s good to stay vigilant.
  11. Create a will and other important documents. What would you want to have happen to your assets if something happened to you, your spouse or you and your spouse? Who would take care of your kids?  Who would make medical decisions for you if you were unable to make them yourself? Not a fun one to end on but this is important stuff.

Let me know what you think?  Is there anything you’d add, delete or change?

Happy New Year!  We look forward to serving you in 2020!


Geoff Hall, CFP®
[email protected]

My wife, Crystal, and I have been married for 11 years and have two kids, Cooper (10) and Rhodes (8.) When I’m not spending time with them you might find me downtown serving at our church, pushing my limits during a mountain bike ride or having coffee with a friend in the Five Points area. I've been a financial advisor for 29 years and I'm thankful for the privilege of shepherding my family of clients through the ups and down of the markets, and of life for that matter.