18 Ways to Improve Your Finances in 2018 


This turned out to be a pretty hefty list, so let's just jump right into it, shall we?  

1.     Make a written plan: A written financial plan doesn't have to be more than one page long. In fact, the simpler the better. The easiest plan is to copy all of these items down, make some notes in each category and set a due date for yourself. Celebrate when you can cross an item off the list as you are one step closer to achieving your goals! 

2.     Budget: "Budgeting" is not a nasty word like "Dieting". Having a budget puts you in control of your finances by prioritizing your spending which reduces stress.  The goal here is to pay yourself first by setting aside money for savings and retirement. Next, you want to make sure you are covering all your “must-have” living expenses. Any money left over is for those items that are not crucial for day-to-day living but make your life more enjoyable. Do this with your partner if you share expenses.  

3.     Emergency fund: The goal is to have 6 months living expenses in an accessible or "liquid" cash savings account for emergencies. You can set up an automatic transfer for each pay period to go to this account. Out of sight, out of mind is the best way to build up your emergency cash.  

4.     Online savings account: For your emergency savings or items you are saving to purchase, I recommend researching for an online bank paying over 1% in interest. I recommend keeping your savings in a separate bank to reduce the temptation to spend it via your checking account.  

5.     Beneficiaries/Will: It is easy to set up beneficiaries on your bank/investment/retirement accounts. Should anything happen to you, this ensures your loved ones would have immediate access to funds. Without beneficiaries on these accounts, the funds could sit in Probate Court with your state. I've heard horror stories of this taking over a year to process. Additionally, making a simple Will also helps to ensure your loved ones are provided for in the manner you wish. You don't have to spend any money on legal fees to do either of these two things and they will help your family greatly.  

6.     Use a rewards credit card: Don't use your debit card. I repeat: Don't use your debit card. Put every expense you can on a rewards credit card (with no annual fee) and pay it off each month. Not only does this pay you in rewards, it also helps boost your credit score and it protects you in case of fraud. If you find a fraudulent charge or charges on your credit card, that is the bank's money. When a fraudulent charge happens on your debit card, you are protected, but it may take the bank a few days to put your money back in your account. This is not a good situation to be in when you have immediate expenses to pay. Therefore, remember this rule and only use your debit card to pull cash out of your bank's ATM.  

7.     Life insurance: If you have a spouse or dependent children, you need to have term life insurance. I don't recommend combining investments with insurance products for this need. The younger you buy this, the cheaper it is. Get a 20-30-year term life policy. The goal is to help cover any mortgage, debt or college expenses should you pass and your income is required to fulfill these obligations.  

8.     Consolidate 401Ks: Most of us have had several different employers along the way. If you have any 401k funds sitting with your old employer's institution, you may be paying higher fees to have them sit there. And, you may have very limited investment choices. My recommendation is to roll these into a traditional IRA (or Roth if your employer offered that designation).  

9.     Check for fees: If you are paying your bank monthly service fees, you need to either work on your spending habits or you need to find a new bank. There is no reason you should pay for a bank account unless you have had financial trouble, have horrible credit, or overdraft your account. Fees also hide in investment and retirement accounts. If you hold an investment or are in a relationship with an advisor charging you more than 1%, you are paying too much.  

10.   Contribute to your retirement: If your employer offers a retirement account with any matching at all, take advantage of this to get the full match. This is your money. Don't let it go away. If your employer doesn't offer a match, shame on them. Go ahead and pass on the employer sponsored plan unless you have maxed out your annual contribution limits to your Roth or Traditional IRA.  

11.   Set up a 529 plan: A 529 plan is a college savings account with tax advantages. With a 529 plan you can invest for your children's education and they can pay for education expenses without having to pay taxes on the money earned. Start this as soon as your kids are born or as soon as you are able. 

12.   Get an HSA: A Health Savings Account is another tax-advantaged account set up to help individuals and families who are in a high-deductible health insurance plan pay for medical expenses. If you and your family are healthy and don't really need much medical attention beyond regular annual visits, getting a high-deductible plan can save you lots of cash. And, when you set up an HSA in conjunction, you are able to basically set up a tax-free account for all your medical expenses in retirement. There are annual contribution limits just like an IRA, but the money you don't use this year rolls over and grows. Additionally, most accounts offer the ability to invest any funds above a certain limit (maybe $1,000 to $2,500). With the most recent indicators saying the average healthy 65-year-old couple will pay $250,000 in medical expenses during retirement, this account can save you buckets of cash now and in the future.  

13.   Review your employer’s benefits package: I just reviewed a client's benefit package and he is an employee of the Federal Government. The number of choices and options were so plentiful and overwhelming, he needed a professional to comb through it all and make a recommendation. Lucky for him. Even if your benefits package doesn't require an advanced degree to interpret the data, it's always wise to read it ALL and talk with somebody about what the best options for you and your family. Review it with your partner. Take advantage of everything they offer and don't just renew the same options year after year without fully understanding the financial implications or what additional offerings have been added. By the way, the deep comb for my client is saving him over one thousand dollars this year.  

14.   Check your credit: Having good credit is like handing yourself a huge bucket of money. The difference in paying 3% on a 30 year mortgage and 4.5% on $250,000 is $76,573. If you don't know what your credit score is, you should find out. Many credit card companies including American Express, Citibank, and Capital One offer free FICO score reports for their credit card customers. There is no need to pay to get your credit score. Also, www.annualcreditreport.com is the government-sponsored site that provides one free annual credit report per individual.  

15.   Shop insurance: I suggest an annual review of your home, life, and auto policies. If you are claims free, you should shop rates annually. Being loyal doesn't pay here in my experience. However, look at ratings for both customer service and financial stability as that is very important.  

16.   Elevate your career: One of the most critical things you can do to improve your financial wellbeing is to look for ways to earn more in your career. Do you need to take some courses to give you that extra edge on the promotion? Would learning another language give you a competitive advantage? Do you have time for a side gig doing something you love to do? Are you stuck in a company that doesn't foster and grow their talent? Spend some time thinking about this and how you can grow your employment income this year.  

17.   Meal plan and eat at home: Do you know how much you spend going out to eat? If you don't, you really should examine these expenses. Do you meal plan and try to eliminate food waste at your home? I experimented with this idea last year and did weekly meal planning, checked my grocery store's weekly circular, downloaded their electronic coupons and saved our family over $2,300 from the year before. Yes, we do occasionally go out to eat, but it's a treat and not an excuse for not having a plan.  

18.   Pay off debt:  We all need to examine how much debt we are carrying and how it is impacting our ability to live a stress-free life. However, in the same breath, I also want to tell you that some debt is actually good. For example, building equity in your home (that you could only buy with a loan from the bank) can be a great way to build wealth. Taking on some student loan debt to increase your earning potential could be a wise decision. Taking out a line of credit to propel your business to the next level could be the answer for increased profits. But, carrying credit card debt, personal loans, pay-day loans, expensive car loans, and being over-leveraged in general is a habit you must break in 2018.  

I hope these ideas get you fired up to try a few of them out. Your money will thank you! 

Make a better financial plan. Make a Life Plan.


I come from a family of list-makers. Even though this is part of my DNA, anyone can make lists and plan ahead. You most certainly can learn the craft if it doesn’t come naturally. This post is about my end-of-year list that has become my annual "Life Plan". 

The Life Plan idea came along organically due to some rough times I had personally where I wanted to hone in on a vision and make a plan to improve every aspect of my life. Along the way, I discovered this process is really fun.  My husband and I have made this a team effort, where at the end of the year we have a celebration. The two of us go out to a great dinner (without kids) to talk about all our accomplishments over the year (no bad news allowed!). Following this meeting, I begin the Life Plan for the next year and we review and agree upon it. The trick with the Life Plan is to make sure you are calendaring activities on a monthly basis to help you accomplish the Life Plan. This is an annual plan, but it may have both long- and short-term goals. Get it all down on paper, a spreadsheet, or on your favorite task-tracking app. Review and re-work this list as needed throughout the year. The idea is to have flexibility and not be too concerned by the daily ups and downs of life.  Below is a list of categories we use in our Life Plan. Once these are developed, we calendar out the action items needed to see them through. 

Personal: These are goals for my personal life. The goals may be to increase exercise, see friends more often or to improve my Spanish-speaking skills. My husband also makes a set of personal goals. 

Financial: Our financial goals may include things like increasing the contributions in our kids' 529 plans, increasing our emergency savings, or decreasing insurance costs. 

Career: A big goal for me this year is to stick to an editorial calendar for more frequent posts! 

Home: We always have a long list of projects we want to complete. It is important to put a dollar amount and a date on what will be accomplished. This list never ends! 

Charity: We have a list of charitable causes we feel strongly about supporting. We plan out what we can give in money, time, or donated goods. 

Vacation: In the ideal world we'd have a lot more of these. Since they are small in number, we plan them out so we can go as big as budget allows. We always shoot for one family vacation and one couple's-only vacation but the latter is dependent upon kind friends and relatives who support this idea by watching our two wild boys.

Bucket List: We may not get to many of these, but this is a catch-all for anything than inspires us. This might be to start taking more photos, go see another Pearl Jam show, or plan a trip to Europe for our next big anniversary. These are kind of "the icing on the cake" or fun things to aim for within the year. 

My Ideal Future: This has been a story at the end of the Life Plan that I write. It paints a picture of what my ideal life looks and feels like. It helps me to solidify the vision. 

The one take-away I'd like you to have is that this process is actually fun and rewarding. Focus on all you were able to accomplish at the end of the year. Anything that wasn't tackled can always be on next year's list. Dreaming is fun, but I've found that getting it all down and out of my head actually produces results. And, when you have buy-in from a partner, there is that magic called accountability. Share with me your thoughts! 

What should 60-70-year-olds invest in?

Since Upward really doesn't focus on retirees or pre-retirement planning, this is not my predominant area of focus. However, from time to time, I get this question, so I thought it was worth discussing.

For people who are investing in their 60's and 70's, I automatically think of "preservation mode". Because these have typically been the years where Americans retire, being heavily invested in only stocks can create a devastating blow to that target retirement date. For example, let's say you were 65 in 2008 and your stock portfolio took a 40% dive. Guess what? That target retirement date just got pushed into the future.

What's the answer?

1. Diversification

2. Money Buckets

3. Regular Reviews


Diversification: As we age, we need to make sure more of our portfolio is focused on modest, consistent, predictable returns. Not only do you want to diversify between stocks, bonds, cash, and real estate, you also want to make sure you diversify between US and international holdings. Oh, and don't forget to not have too many eggs in one basket. Make sure you diversify among various industries and ladder your bond maturities.


Money Buckets: Because many of us get a late start in retirement savings, some people may need to play catch up. That being said, I don't recommend a person in their 60's or 70's to bet it all in the markets to try to grab onto a 20% annual return. This is where money buckets come in. A money bucket holds funds reserved for short-, mid-, and long-term time horizons. This takes planning to accomplish, but is an excellent way to manage capital preservation and need for growth. Short-term funds are used for 1-3 year needs and emergency funds and should be liquid and conservatively invested. Mid-term funds would be in the 3-7 year time frame and moderately invested. Long-term, 7 years plus, would be positioned for growth.


Regular Reviews: Most of us need the input and direction from a professional from time to time. Don't risk your future on doing it yourself. Even the best financial planner farms his/her own portfolio to a like-minded adviser for input, direction, and confirmation. I recommend a fee-only planner, CFP, and an advisor who doesn't make all his/her money on commissions for selling investments. Make sure they are performing as a fiduciary and initiate yearly comprehensive meetings at a bare minimum.

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