Much like the couples on the popular American reality TV show
90 Day Fiancé, where participants have just 90 days to decide whether to commit to marriage or walk away, your finances deserve a similar level of attention and urgency. In 90 days, you can take a deep dive into your financial life to reassess your goals and make critical decisions that will change your future for the better. A 90-day financial checkup gives you the opportunity to either strengthen your financial foundation and/or identify weak areas in need of improvement. Whether it is eliminating debt, fine-tuning investments, or building a sustainable budget, three months is more than enough time to make significant strides. Use the next quarter to realign with the goals you set at the start of the year and position yourself to hit the ground running in 2025.

What is a financial Check-up?

A financial checkup involves a comprehensive analysis of your financial situation against your financial goals. This includes reviewing your spending habits, debts, savings, investments, retirement account, estate plan, and future goals. Experts believe that it is useful to carry out a financial check-up, at minimum, once a year and after any major life event, such as a marriage, divorce, birth, or death — and even a promotion. If you missed your mid-year financial check-up, then, now is a good time to determine if you are fiscally fit or financially flabby before the year ends with these five steps:

Assess Your Debt

Understanding how you got to your current financial position is essential to planning for where you want to go. Begin by evaluating your progress in reducing debt and managing it. If your debt has increased, it’s important to reassess your situation and determine why. For example, what if your debt increased because you have taken on an investment property or bought your first home? In these cases, debt was used as a strategic tool, helping you achieve your financial goals. However, if your debt increased because of loans for consumption, such as high interest credit card debt, now is the time to adjust your spending and reallocate funds toward paying down debt aggressively. With the New Year approaching, it’s not too late to prioritise debt repayment, starting with high-interest accounts or the consolidation of your debt into one manageable payment. Once your debt plan is in place, update your budget to reflect your new financial goals.

Invest in Yourself

It is very easy to fall in the trap of buying the latest trends and styles, or becoming the neighbourhood’s Santa Claus without having a solid financial plan in place to secure your future. While it is admirable to express your generosity in this fashion, it is even more critical that you take care of your future-self first. Setting up a standing order for automatic transfers into your investment account is a simple, yet powerful way to build wealth. By consistently investing in yourself, you’ll benefit from the magic of compound interest — earning returns on your initial investment and on the interest accumulated over time.

Check on your Emergency Fund

Life’s unexpected challenges can arrive when least expected, as the Jamaican proverb “Trouble nuh set like rain” reminds us. If you’ve had to dip into your emergency fund this year, don’t worry — that’s what it’s there for. However, make it a priority to replenish those savings as quickly as possible. To get the most out of your emergency fund, keep it in an account that offers higher interest rates than a regular savings account.

Update your Insurance and Estate Plans

Revisit your will, trust, or insurance policies to ensure you are happy with your choice of executor, trustee, and anyone to whom you have granted power of attorney. Double-check beneficiaries and allocations to make sure your estate planning and insurance align with your current wishes, as well as your long-term financial goals. It is also important to assess whether your insurance coverage is adequate. Do you have all the types of insurance you need, such as critical illness or sufficient life coverage? Is the property you acquired sufficiently insured in the event of a disaster? Did you do a renovation on your home that necessitates increasing your Peril Insurance coverage? If not, you may want to increase your insurance coverage to reflect your current circumstances and future needs, ensuring that you are properly covered — both your assets and your loved ones.

Boost Your Retirement Contribution

Who doesn’t want to retire like a boss? To achieve this, it’s crucial to assess your progress toward retirement and boost your contributions and importantly, explore additional sources of retirement income for greater results. In other words, are you contributing the maximum percent of your gross salary towards a managed pension plan? Importantly, plan for ways to augment the income from your retirement plan, such as an investment property/properties) or financial investments like stocks and mutual funds. The reality is that your pension alone may not be enough to ensure a comfortable lifestyle in your golden years. By diversifying your income streams now, you can better secure your financial future and enjoy a more robust retirement. The reality is that the earlier you start paying your future-self, the more prepared you will be financially on your retirement journey.

The Bottom Line

With less than 90 days left in the year, there is still time to conduct a thorough financial health check-up and make meaningful changes to strengthen your financial position. If your finances aren’t particularly complicated, you should be able to do a financial check-up on your own. However, the more complex your finances are, the more likely that you will benefit by engaging a financial planner or other experts to assist you. Wealth advisors from NCB Capital Markets Limited will be conducting ‘Wealth Checkups’ on October 12, 2024, between 10:00 am and 5:00 pm at MegaMart, Kingston and Fairview Plaza, Montego Bay to help you and other investors stay on track with your financial goals. Think of this check-up as an opportunity to determine whether you’re on the path to being fiscally fit or financially flabby. Just as you would prioritise your physical health, take this time to fine-tune your financial fitness to end the year strong. Take advantage of this pop up, and be intentional about the actions you take after the assessment so that you can secure your financial future. Additionally, you can reach out to a wealth advisor at ncbcapinfo@jncb.com to set up your personalised consultations.