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10 Helpful Financial Moves To Make Every Year

Updated: 01/30/2023 by Financial Samurai 29 Comments

Financial Moves To Make To Get To Santorini
Cheers to the best time of the year!

The end of the year is always the best time to reflect and plan. I’d like to share several financial moves you should make before the new year in order to protect your wealth and hopefully grow your wealth in a risk-adjusted manner next year.

Those of us who invested in stocks, real estate, and many other asset classes except for oil should be feeling fortunate. But don’t forget that good times seldom last forever.

Never forget the Armageddon days of the 1997 Asian Financial Crisis, the 2000 dotcom implosion, and the housing + financial meltdown that began in 2008. Those of you who haven’t been investing at all better get ready to deploy capital when chaos returns, or else inflation will eat your wealth alive.

If you just started investing in the past five years, lucky you! Don’t worry. Your beat down will happen eventually. But like every beat down, things always get better over time. Look at all of us old farts who are still around.

10 Wise Financial Moves To Make

Here are the top 10 wise financial moves you should make this year.

#1 Financial Move: Review your asset allocation

One of the most important financial moves you need to do is review your asset allocation. Setting and forgetting it is not a good strategy if you want to stay properly diversified.

For example, you might deploy a 50% equities, 50% bonds asset allocation. But if your equities climb 35% while your bonds decline 10%, and you want a 50/50 balance, you’re out of alignment because your portfolio is now 60% equities and 40% bonds.

I believe investors should rebalance at least twice a year, no matter how small the rebalance is. Taking the time to rebalance helps focus your attention on your investments so they don’t grow too far out of whack.

I’m personally following my Financial Samurai Asset Allocation Model for my age of 80% equities / 20% fixed income (mostly muni bonds). You can click on the post to see three other asset allocation models tailored towards your risk tolerance.

#2 Financial Move: Review your income and spending

You’ll be surprised by how much you’ve spent, and how much you THINK you’ve spent. Chances are high that you’re spending more than you realize, which is a detriment to your net worth building goal. This is why another very important one of the important financial moves you need to do is review your income and spending.

It’s the same idea as withdrawing money from an ATM machine and wondering where all the cash went a couple days later. Definitely tally up your total annual income and spending amounts. Then divide the figures by 12 to make the numbers more granular. Adjust your spending accordingly.

I’m always 90% focused on making more money because there’s only so much I can save. I’ve set detailed limits for spending on housing, food, transportation, entertainment, travel, etc, and rolled these figures up to a monthly figure I will not cross. 

It’s a thrill to stick to a set spending number while trying to earn as much as I can beyond that threshold. The spending number is high enough where I feel free, but responsible with my money. 

#3 Financial Move: Declutter and donate to charity

Not only is donating good for people in need, you get to declutter your house and get a tax write-off up to $500 per donation without having to fill out a form to say where the item came from.

We all tend to accumulate a bunch of stuff over time. It feels absolutely fantastic to get rid of “excess inventory” so that people with low inventory can be helped. You can also donate other assets such as stocks, your car, and other valuable goods as well.

Also consider decluttering your lifestyle. Our finances and lifestyles have a tendency to get more complicated with age. As you start to approach retirement, consider simplifying for less stress and greater happiness. Minimalism and early retirement go perfectly together.

When I last moved houses, I donated about eight bags of clothing to Goodwill and The Salvation Army. Less stuff means less to move! I had a couple items of furniture that couldn’t fit my smaller house that I had to donate as well.

I originally considered donating my car Moose for the tax write-off. But, I found it was so much more convenient to just trade him in when I got the Honda Fit. Besides, I’m not sure how much longer Moose would have lasted. 

#4 Financial Move: Update your resume

Now is the time to update your resume and make sure it’s the best looking document on your computer. You’ll be surprised by how much you’ve accomplished over the course of a year that you can add to your resume.

Make different versions of your resume for different types of industries or jobs you’re eying. End of January through June is peak job hunting season.

Although I’m not actively looking for a job, my resume is updated with my latest accomplishments. I’ve got a finance version of my resume, just in case there’s some incredible opportunity to go back. I’ve also got an internet/media version of my resume. There’s a growing opportunity to help companies with their content strategy. There’s even “Chief Content Officer” titles now that pay multiple six figures.

As someone who has built a brand online that generates a good amount of organic traffic every day, I’ve been receiving a lot of inquiries from companies all over after I began consulting. Your X Factor can lead to many unforeseen opportunities! Stick with it!

#5 Financial Move: Keep yourself and your family safe

It’s important to make sure you’ve got appropriate health care insurance for you and your loved ones. Medical costs consistently rank as one of the top reasons for bankruptcies in the United States.

I don’t care if you are worth $5 million liquid. Some random illness could wipe you out if you don’t have the appropriate health care. In addition to having the appropriate health insurance, please make sure your housing insurance, car insurance, and personal property insurance coverage are correct.

Finally, if you have lots of assets that go beyond what your housing and car insurance can cover, definitely get an umbrella policy. The linked article explains what an umbrella policy is and how much it may cost.

I recently raised my umbrella policy by $1 million due to the bull market. Health insurance is going to be an issue for me in 2015 because I’m a contractor who no longer has Cobra from my old employer. As a result, I’m going to be venturing into the scary land of getting self insured under the new Obamacare policy.

You can see how much subsidy you can get based on income and family size in the linked post. I fully expect to pay around $700 a month per person and $1,400 a month for two.  I think these figures are absurd, but that’s the price to pay for freedom.  

#6 Financial Move: Review your will

Along the lines of financial moves to keep your loved ones safe, prioritize estate planning. Make sure you either have a will, or have an updated will if your financial circumstances have significantly changed.

You don’t want to inherit $50 million bucks, die, and then cause your entire immediate and extended family to start a civil war because they don’t know who is getting your millions. Money brings out people’s evil side, especially for those who’ve never had a lot of money.

Do your descendants a favor and be organized. Create a death file and inform your beneficiaries where all of your most important documents and instructions are. Make things as easy as possible for them to settle your estate. Here’s a very helpful checklist on preparing for death – your loved ones will thank you.

When I first wrote this post, I only had a living will that had gotten out of date due to the growth of my online business. Fortunately, my wife and I met with an estate planning attorney after son was born and we got our estate plan in order.

#7 Financial Move: Plan your taxes

I’ve already written an extensive piece about year-end tax moves to make. The bottom line is that for the large majority of people, the government takes away more than people save of their own income. How ridiculous is that?

Take time to gather your expenses, contribute to your pre-tax retirement funds, and calculate a realistic income figure for the next year. The closer your income figure calculation is to reality, the better you can manage your expenses, and ultimately your tax bill.

I’ve already begun gathering all my receipts and categorizing my expenses to deduct against my contracting income. I’ve also written all these posts about the subject to help get my mind straight. 

# 8 Financial Move: Tie up loose ends

Use the end of the year to finish strong by completing all the things you should have completed already. The idea is to start the new year with as clean of a slate as possible so you have maximum momentum to achieve your goals.

Have you used up all your gift cards and expiring points? Maximize what you have and get rid of the baggage.

One of my biggest loose ends is finishing up four hours of online traffic school in order to pay my reduced traffic ticket. I don’t want that hanging over my head given I plan on traveling for a month in 1Q.

The other loose end is getting my bathroom plans approved by the San Francisco Department of Building so I can find bidders to do the work.

Then, my final loose end is selecting some new P2P loans returning 8-10% now. P2P lending has been my most neglected passive income stream over the past two years. I plan to change that by beefing up my account size and invested notes. Earning a ~7.3% return without having to do any work is very attractive. I could have earned more, but I was too lazy to deploy capital. 

# 9 Financial Move: Run your investment portfolio through a fee checker

Do you know why money managers are so rich? It’s because they charge a tremendous amount of fees. It’s frustrating when your employer only offers actively run mutual funds with high fees, but it’s still better to max out your pre-tax retirement accounts as much as possible.

At least once a year I run my investment portfolios through Personal Capital’s Retirement Fee Analyzer. Just link your investment accounts and click on the Investing tab on the top right and then click Retirement Fee Analyzer.

I’ve optimized my two portfolios so that my annual fee is estimated at only 0.18% compared to the benchmark of 0.5% due to my selection of ETFs, Index Funds, and specific stocks. The other cool feature is the Investment Checkup feature that shows your current vs. target allocation. 

Retirement Fee Analyzer Personal Capital

#10 Financial Move: Rekindle neglected relationships

Do you know what happens at the beginning of each year for working professionals nowadays? We get inundated with LinkedIn requests and messages from friends on LinkedIn, FB, and wherever. Why? Because people are doing everything possible to network in order to find a new job.

This is problematic because people are only trying to connect with you when they need something. Although this is natural, it is not ideal at all. It’s much better to reach out to people throughout the year, check in, maintain relationships, and then potentially ask for help when help is needed.

Spend time looking through your connections you’ve neglected and at least drop a “happy holidays” type note and a brief summary of what you’ve been up to.

I’m going to spend at least five hours going through my social connections and wishing them well for the holidays. Life always gets really busy and we tend to neglect the majority of people we know.

I used to send out a couple hundred holiday cards a year, but I’ve gone 100% digital since. People tend to help people who’ve been there over the long term. I also plan to reach out to people who I’d like to get to know more and make a commitment for at least the next six months to see what happens.

Related: What Is The Real Meaning Of Wealth?

Financial Moves BONUS: Brainstorm and commit to doing one big thing

The world is chaotic, but don’t forget to set aside some quiet time soon in order to brainstorm and think big. I’m not talking about losing five pounds or getting a 10% raise that won’t do much for your life.

Instead, I’m talking about potentially life-altering objectives. This financial moves bonus is committing to doing something big. For example, changing jobs, moving to a different city/state/country, starting a business, finding the love of your life, buying a home, getting that degree, and more.

Visualize Success With Your Financial Moves

There is a reason why people create vision boards. They work! I advise everyone to visualize themselves 12 months from now in a more successful financial position. You’re more likely to complete the 10 financial moves above if you visualize success.

For example, if you no longer want to do your craptastic job that requires no thinking, visualize yourself doing something new and exciting with a different company.

If you no longer want to be in a dull relationship with a partner who takes you for granted, visualize yourself taking an amazing vacation with someone else. Or, if you’re sick and tired of living paycheck to paycheck, visualize yourself rocking an enormous bank account due to the positive steps you’ve taken to create wealth.

Years will continue to go by quicker and quicker the older we get. Make the most out of each one.

Readers, what other things do you recommend people do every year at least once? 

Regards,

Sam

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Filed Under: Budgeting & Savings, Career & Employment

Author Bio: I started Financial Samurai in 2009 to help people achieve financial freedom sooner. Financial Samurai is now one of the largest independently run personal finance sites with about one million visitors a month.

I spent 13 years working at Goldman Sachs and Credit Suisse. In 1999, I earned my BA from William & Mary and in 2006, I received my MBA from UC Berkeley.

In 2012, I left banking after negotiating a severance package worth over five years of living expenses. Today, I enjoy being a stay-at-home dad to two young children, playing tennis, and writing.

Order a hardcopy of my new WSJ bestselling book, Buy This, Not That: How To Spend Your Way To Wealth And Freedom. Not only will you build more wealth by reading my book, you’ll also make better choices when faced with some of life’s biggest decisions.

Current Recommendations:

1) Check out Fundrise, my favorite real estate investing platform. I’ve personally invested $810,000 in private real estate to take advantage of lower valuations and higher cap rates in the Sunbelt. Roughly $160,000 of my annual passive income comes from real estate. And passive income is the key to being free.

2) If you have debt and/or children, life insurance is a must. PolicyGenius is the easiest way to find affordable life insurance in minutes. My wife was able to double her life insurance coverage for less with PolicyGenius. I also just got a new affordable 20-year term policy with them.

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Comments

  1. Jamie says

    January 30, 2023 at 11:11 pm

    Reviewing asset allocation and rebalancing is such an important financial move! It’s so easy to forget to do this too. I’ve become reliant on calendar reminders to do things like this. Otherwise, many months or even years could go by and change the entire portfolio make up.

    Reply
  2. CRP says

    January 13, 2015 at 10:05 am

    Hi Sam,

    Great article per usual.

    How do you feel about Employee Stock Purchase Plans?

    I have read plenty of articles raving about getting 15% off the low point in a quarterly or half year stock price with the general consensus being;
    Max out your contribution ($25,000 or % of salary)
    Sell ASAP

    It seems more and more common to see lower (5%) discounts and/or rather then using a look back simply taking a % off the current purchase price…

    So onto the questions!
    Do you agree with the 15% + look-back being a no brainier? Then, taking it a step further, with these less advantageous plans; Should participating be a yearly move?

    Reply
  3. Michael Mota @ negativetopositivenetworth.com says

    December 26, 2014 at 6:06 pm

    Great article! I especially like the idea of rekindling relationships- something I need to work on. I will have to book mark your site and return often.

    Reply
  4. Nik @ Midlife Finance says

    December 25, 2014 at 6:42 am

    Great post! Something I will do before the year ends. Thanks much!

    Reply
  5. c2w says

    December 23, 2014 at 9:09 am

    Hey, quick Qs on Personal Capital:

    -You seem to like them a lot, do they fund you at all?
    -Linking all my accounts seems kind of tedious, about how long does it take?

    Reply
    • Financial Samurai says

      December 23, 2014 at 3:13 pm

      I’ve worked as a consultant for them for the past 12 months b/c I believe in the product. To me, it’s a no brainer b/c it’s free and helps empower individuals to get a hold of their finances. All it takes is effort to focus on one’s financial well-being since it’s free.

      Check out: A New Adventure Begins: Consulting For A FinTech Company

      It took about 10 minutes to link up all my accounts. But I have over 30 accounts to link up nowadays!

      Reply
  6. BH says

    December 22, 2014 at 8:07 am

    Great post. I need to work on asset allocation as I don’t have any fixed income. I figure I’ll wait a few more years and it’s okay to be 100% in equities in my investment accounts right now – but there is nothing scientific or even analytic about this approach – it just seems like a good idea. I also made the mistake this year of letting a manager run my old 401k and, comparing it to my Roth IRA (to which I can’t contribute anymore) that I manage myself,the 401k did about 20% worse. I learned a hard lesson there about trusting your money with other people.

    I love taking a some quiet time between Christmas and New Years to reflect on next year’s goals. Last year I made a goal of connecting with 5 contacts per day, even if it was something really simple on social media. Although I didn’t have a 100% success rate, it went well.

    Reply
    • Financial Samurai says

      December 23, 2014 at 3:16 pm

      Connecting with 5 contacts a day is aggressive since that is 1,600 a year! I would say connecting with 100 contacts a day would be a success!

      Reply
  7. g says

    December 22, 2014 at 6:14 am

    Awesome list – helps put things in perspective. I am packing to leave SF – wish me luck!

    Reply
    • Financial Samurai says

      December 23, 2014 at 3:17 pm

      You really going to North Carolina?! Tell me more, why!

      Reply
      • Sir Salty says

        December 24, 2014 at 11:18 am

        Nice…the Tar Heel State! It’s great here – I hope you love it. Very different than big-city west coast, but many positives to living in NC.

        Reply
  8. May says

    December 21, 2014 at 9:53 pm

    Hi:
    We have a few things in common. I’m a Content Strategist contractor in the Bay Area specializing in e-commerce. I use to get my health insurance through COBRA but it ended a few days ago, so now I’m on an Obamacare plan as of December 2014. I feel grateful for the Affordable Care Act (Obamacare). Before this law passed, health insurance carriers would discriminate against folks who have pre-existing conditions by jacking up monthly premiums if they granted them policies at all. I’m an avid follower of your blog by the way. Thanks for helping folks like me out.

    Reply
  9. Mr. Captain Cash says

    December 21, 2014 at 8:52 pm

    Great list you have put together here. I well definitely be reviewing my income and tracking my spending much more closely throughout 2015 to make myself more profitable and increase my chances of achieving financial independence within four years before my 29th birthday.

    Mr. Captain Cash

    Reply
    • Financial Samurai says

      December 23, 2014 at 3:12 pm

      You’ll definitely be surprised by what I think is much more spending than you think you spent. It’s kinda scary. You looking at Fidi by 25?

      Reply
  10. Jay @ ThinkingWealthy.com says

    December 21, 2014 at 1:48 pm

    Ahhhh updating the ole resume. Needs to happen even though I’m not actively looking. Bonus season is around the corner which means hiring season will soon follow!

    Jay

    Reply
    • Financial Samurai says

      December 23, 2014 at 3:11 pm

      Good luck w/ your bonus! If it’s big, I’m open to a nice steak dinner.

      cheers

      Reply
  11. Jason says

    December 21, 2014 at 1:15 pm

    I really like the idea of rekindling relationships – this is something I’ll get cracking on right now just before Christmas, but will do throughout next year as well, so it doesn’t become just an annual thing.

    I’m also with Sir Salty above – I like to reflect on where I’m spending my time, and try to recalibrate in line with my values and goals. Although rather than get too focused on the day-to-day balance which just tends to be frustrating to manage, I heard some great advice that you should try to find your balance over years, not days, which I think has some merit to it. This past year I’ve really focused on time with family and personal goals which I’ve been very happy with, but less on career. Next year I plan to focus much more on career and wealth, and hopefully when I reflect back 4 or 5 years from today, I’ll feel like I’ve achieved a pretty good balance overall.

    Reply
    • Financial Samurai says

      December 23, 2014 at 3:11 pm

      Definitely a good idea to rekindle a relationship now in 2014, vs. in 2015. Even if the difference is just a week or two, it makes a psychological difference.

      Reply
  12. missdriven2succeed says

    December 21, 2014 at 10:30 am

    Thanks for your feedback re: Canadian real estate. You’d be surprised how many industry experts and even Bank of Canada believes that our housing is about 30% over valued. I sold my condo over a year ago due to the heavy construction building, you may be aware that Toronto is the #1 leading condo development city in North America! It’s absolutely insane. There are several real estate blogs that I follow all touting the same belief.

    Anyways, I didn’t lose money, which is great, however, no one gets into real estate to essentially to break even. I’m kicking myself for not taking more risk with my investments and seeing how low interest rate returns are for GIC/CD under 3%, as the goal was to retain my wealth due to my belief that there were major market corrections underway. I still think this way, however, I’ll be looking for investment ideas with greater returns. My short term goals are approximately 700K net worth before or by 37 years old and an income producing business, preferably online. Hopefully invest in a house in the next year or so, until then, stay educated and keep reading amazing blogs like yours!

    I know it’s not anywhere close to retirement levels, however, given I earn above average income and save much of it, this has helped propel my net worth above many of my peers I know in my age bracket. I’m all about sacrificing now and living like a queen later on!!

    Thanks again for your valuable insight!!!

    Reply
    • Financial Samurai says

      December 23, 2014 at 3:10 pm

      $700K net worth by 37 will be a nice chunky great achievement! From a US perspective, the Canadian housing market sure seems frothy. I’m aware of many pundits and blogs calling for the Canadian RE market to crash. What I do know is that bubbles and crashes last much longer than anybody realizes.

      Reply
  13. James says

    December 21, 2014 at 10:05 am

    Nice and comprehensive list. Your expertise from the financial industry showing, no doubt.

    I think I’m just going to make this one of my end-of-year checklists, as you call out highly valuable items to execute on that I don’t have a set schedule for (ex: update resume, rekindle relationships). And these are specific, actionable steps that we can take should we decide such rather than a generalized year-end list that you might see elsewhere.

    Now I need to brainstorm on what my one big thing will be…

    Reply
    • Financial Samurai says

      December 23, 2014 at 3:00 pm

      Let me know once you figure it out. The best is to just get going. You’ll wish in a year from now you started TODAY.

      Reply
  14. Msdriven2succeed says

    December 21, 2014 at 6:21 am

    Hi!

    First off, thanks for being candid and offering actual suggestions based on methods you’ve used that have boosted your net worth. I believe that many individuals are spending above their means and not preparing for a “rainy day” or retirement. I’m 32, female and saving well your recommended savings goal, I have now reached a comfortable 6 figure net worth (which I thought would only happen in my 40s). I’m waiting for the real estate correction in Canada as well as really considering a similar P2P lending models to yield a greater return, since I’m investing mainly in the CD equivalent or GIC across my entire portfolio. I’m staying semi-liquid so that I can invest as soon as the real estate market corrects…

    Btw, what is your opinion on investing in gold, silver or commodities? Any additional thoughts/suggestions would be great!

    Thanks again,
    Msdriven2succeed

    Reply
    • Financial Samurai says

      December 21, 2014 at 9:25 am

      I do wonder whether the Canadian real estate market will ever have a massive correction like we had in the US. But your banks are much strong than ours during the time of the crisis, and you guys don’t have as much speculator fever, nor do you have the mortgage interest write-off.

      Gold and silver are hedges against a market collapse given they are real assets, but they provide no income stream. They are just relative value plays which can be effective for short term hedges. I wouldn’t asset allocate anything more than 10% in this asset class. It’s speculative.

      Reply
  15. Sir Salty says

    December 21, 2014 at 5:38 am

    Good list of end-of-year to dos. While doing an annual review of income/expenses, I like to add consideration of how I’m spending my time in an average week. Think back about work, vs family, vs entertainment, vs exercise, vs friends, vs errands, vs commuting, etc. Try to map out my time, then reflect on whether that allocation is ideal.

    It’s empowering to remember that I decide how I spend time. Usually it prompts me to carve out more downtime and unstructured time with family.

    Reply
    • Financial Samurai says

      December 23, 2014 at 2:58 pm

      Excellent tip. Figuring out how much to allocate one’s time is definitely something I plan to do in 2015. I spent way too much time working on my consulting gigs, and didn’t have the discipline to cut things off when I reached my time limit.

      Reply
  16. Loser 2 Winner says

    December 21, 2014 at 4:18 am

    Hey Sam, great article.

    Just out of curiosity, how come you don’t publish your blog earnings as part of your passive income stream?

    Even though its not entirely passive of course.

    Reply
    • Financial Samurai says

      December 23, 2014 at 2:54 pm

      Because online income isn’t passive. It takes a lot of work. It also feels weird reporting my income. I’m of the stance that one should never real how much they truly make every year. Only bad things happen as a result, especially if the figure is higher than average or median.

      Reply

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    […] Everybody is born with a different set of circumstances. I play tennis with members at my club whose children will all be set for life. I’m sure they’re all great kids, but what about the great kids who grow up in broken homes? Poverty is an extremely difficult situation to escape, no matter how much we say that education is the key to wealth. […]

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