"Spring Cleaning" Your Finances
If you’re among the two-thirds of Americans who admit to having disorganized personal finances, spring is the perfect time to tackle this issue. Three top personal finance projects for Americans, according to the Country Financial Group, are:
- Cleaning up credit card debt.
- Reducing spending.
- Establishing a plan to build emergency fund savings.
Each age group has its specific challenges.
Millennials, who are still mastering the basics, identify spending habits, student loan debt and credit card debt as their most critical tasks to address. According to the Country Financial Security Index, created by Country Financial and based on surveys compiled by GfK, an independent research firm, only 57% of millennials follow a budget, and one third of millennials have never checked their credit report; some do not even know how to check their credit score.
“One of the key steps millennials can take is to create—and stick to—a household budget that will help them reach their future goals,” says Joe Buhrmann, manager of financial security at Country Financial. “Whatever the amount of your assets, it’s important to monitor and protect what you have.”
In the age of online banking and investing, it’s important to protect your financial information online as well. Despite being known for their tech savvy, nearly half (47%) of millennials admit to using the same or a similar password for their online financial accounts as they do on other internet sites, opening themselves up to hackers and identity theft.
Generation X is most burdened by debt, the Country Financial Security Index found. Just 10% of Gen Xers are debt-free, compared with 18% of the general population and 24% of those 65 and older. With 23% of Gen Xers saying their credit card debt needs to be cleaned up, these consumers at least have learned to keep close tabs on their credit scores.
The over-50s, including baby boomers and seniors, should be building a nest egg and paying down debt to prepare for retirement and the transition to living on a fixed income. However, only about half of Americans over age 50 know exactly how much debt they owe, and only 42% have an established budget they follow every month.
“In different stages of your financial life, there will be different priorities and pain points,” said Buhrmann. “Taking time this spring to adjust the weak spots in your financial plan can help right the course toward reaching your financial goals.”