Financial Checklist for 2020: Make This the Year to Reach Financial Goals

If you want to start the New Year off right and reach your financial goals, check out this financial checklist for 2020. 

#1 Set Short- and Long-Terms Goals for 2020

financial checklist for 2020
This comes first on our financial checklist for 2020 because, if you don’t have a plan, rarely will you reach your goals. 

If you haven’t already, write down any big purchases or savings and debt goals you have for the coming year.  

Then determine how much money you need to meet each particular goal and the date you want it by. 

For each goal, divide the total amount needed by the number of months until your goal date, and that will give you the amount you need to save each month. 

It does no good to set your goals and put them in a drawer. Instead, keep your goals somewhere you will see it. 

If you need to, find an accountability buddy.

Make sure to review it each month and track your progress. If you fall behind, don’t beat yourself up. Just get back on track as soon as possible. 

#2 Create a Budget and Stick to It 

financial checklist for 2020
First, take the time to review your 2019 budget and evaluate what worked and what didn’t. 

Review your spending habits and ask yourself…

  • Where did I overspend? 
  • What did I spend money on that I can cut and instead put toward my retirement savings? 
  • Where and why did I fall short of my savings or debt payoff goals in 2019? 

Learn from your answers. Then, create a budget for 2020. 

Make sure at the end of each month you take the time to review your budget

If you can see what you spend month to month, it’s easier to eliminate waste and stay on track. 

#3 Pay Yourself First

financial checklist for 2020
If you really want to make 2020 the year you reach your financial goals, then start by paying yourself first.

When you get paid, before you do anything else (pay bills, buy groceries, or buy anything), pay into your savings and investments first.

If you have a 401(k), your retirement savings are automatically taken out of each paycheck. 

If you have an Individual Retirement Account (IRA), you should be paying into this first as well.

Same goes for savings for your emergency fund. Pay into this before you pay any of your bills. Once you’ve paid yourself, then pay your bills. 

Whatever is left over is yours to spend however you want. 

If you don’t have much left to spend at the end of a pay period, just remember, you’re building a nest egg for the future. 

Then, should an emergency arise, you’ll be able to pay for it in cash and not have to borrow or put it on a credit card. 

#4 Make Paying Off Debt a Priority 

financial checklist for 2020
Debt is consuming American households. 

Student loans, credit cards, personal loans, car loans, and expensive mortgages. 

A Bankrate survey conducted in February 2019 shows that 40% of respondents aren’t saving for retirement because they have too many other expenses.¹ 

The same survey reported that 1 in 5 adults cannot cover their current monthly bills. 

And auto-loan delinquencies that are 90 days or more past due skyrocketed to 4.69% earlier in 2019–just below the peak delinquency level during the Great Recession in Q4 of 2010.²

The situation many Americans find themselves boils down to this: overspending and poor money management

The more you owe, the less you have to pay yourself and save for retirement or fund your emergency savings account. 

No matter the size of your debt, make 2020 the year you make it a priority to get out of debt. 

If you aren’t sure how you can pay down the debt you want with your current income, take on a side hustle. Designate the money you make to go toward your debt. 

#5 Build an Emergency Fund

financial checklist for 2020
This is an important item on our financial checklist for 2020. 

Yes, paying off debt is critical if you want financial freedom. 

However, you may find yourself right back in debt if you don’t have a rainy day fund should an emergency arise. 

Experts advise people should save 10-15% of their income. 

Let’s say you’re currently saving 8% of your income in your 401(k). 

You should take the remaining 2-7% and fund a savings account for emergencies until the account is funded. 

If you’re already saving 15% of your income, see if you can put an additional 1-5% into your rainy day fund. 

If you don’t have emergency savings, start now. If you aren’t sure how you can fund it, review your monthly budget and see what you can cut back on. 

#6 Put a Retirement Plan in Place

financial checklist for 2020

This quote from Global Economist and 2013 Nobel laureate in economics Robert Shiller says it all…

“Retirement is a once-in-a-lifetime event. You had better get it right.”

It’s never too early or too late to get clear on when you will retire and how much you’ll need for the lifestyle you desire. 

And the sooner you start, the better your chances are of ending ahead, or at least on track. 

If you don’t already have a plan in place, sit down and write out the answers to these questions: 

    • At what age do you want to retire? 
    • What do you want your retirement to look, feel, and be like? 
    • How much money will you need to have a fulfilling, comfortable retirement? 
    • And how much do you need to save right now to ensure you will reach your goal? 

Your answers might change as you near retirement, but answering the above helps get a plan in place. 

Check out our 401(k) calculator to see how much you may have at retirement, and calculate how professional help may improve your future retirement savings. 

If you’re stuck, seek third-party advice to help craft a plan that will meet your goals and objectives. 

It doesn’t matter if you only have a few hundred saved or tens of thousands. Getting professional help may save you stress and anxiety in the future. 

#7 Become an Engaged Investor

financial checklist for 2020
Financial ignorance is costly. 

If you’re investing in your 401(k) or any other retirement savings accounts and you’re not clear what you’re getting, it’s time to become engaged with your investments. 

All too often, when 401(k) or IRA statements come in the mail each month, people toss them in the trash. 

Others try to read it, but don’t understand what they’re reading. 

It’s important you become engaged with where you’re putting your hard-earned money. 

Open your statements and read them. Doing so helps you determine whether or not you’re on track to meet your financial goals and may have a big impact on your overall returns.

If you don’t understand what you’re receiving, educate yourself. 

Remember, this is your financial future we’re talking about. 

Invest in yourself now and your future self will thank you! 

#8 Revisit Your Retirement Contributions 

financial checklist for 2020
Review how much you’re contributing to your 401(k) or other workplace retirement account. 

Can you put in an additional 1%? 3%? 5%? 

If you got a raise in the last few months, have you increased your contribution? 

If you aren’t already, at least take full advantage of your employer’s match. 

Company matching is one of the secrets to maximizing your 401(k) or workplace retirement account. It’s like getting free money.

#9 Try to Maximize Annual Contribution Limits

financial checklist for 2020
Do what you can every year to maximize contribution limits on your 401(k) or other workplace retirement account. 

The annual 401(k) contribution limit for 2020 has gone up from $19,000 in 2019 to $19,500. This applies to 401(k), 403(b), most 457 plans, and the federal Thrift Savings Plan. 

For those age 50 and older, the 401(k) catch-up contribution limit will also increase $500–from $6,000 in 2019 to $6,500 in 2020.

How much you can realistically contribute to your 401(k) depends on how much you earn and the amount of debt you carry, among other factors. 

Even if it’s a stretch, do what you can to save as close to the 401(k) contribution limit as possible. 

Even if this means making cuts in monthly spending. It’s amazing how cutting daily lunches out at work or mowing your own yard can save each month. 

At least contribute the minimum of what your company will match because it’s basically FREE money to you. 

And, depending on what your company matches, it may double the amount of what you’re already saving. 

When you’re working on your budget, figure out how much you’re contributing to your 401(k) each pay period and see if it’s possible to save a minimum of $100 more starting in 2020. 

#10 Rebalance Your 401(k) Quarterly

financial checklist for 2020
If you aren’t rebalancing your 401(k) account allocations quarterly, you may be missing out on earning more and keeping more of your hard-earned retirement savings. 

Because unmanaged allocations may experience much larger losses in down markets and may miss the opportunity for growth during good markets. 

We recommend rebalancing your account allocations every quarter, or four times a year. 

This way, you can make the appropriate changes in order to stay on course with your savings goals.

#11 Max Out Your 2019 IRA Contribution before April 15

financial checklist for 2020
Individual retirement account (IRA) contribution limits are $6,000 for 2019. The catch-up contribution for people age 50 and over is an additional $1,000.  

You can contribute the maximum for 2019 until April 15, 2020. Make it a priority to fully fund your IRA before this deadline. 

#12 Clean Up Your Credit

financial checklist for 2020
If you have a low credit score, it’s time to get to work on raising it… especially if you plan on buying a house, car, or taking out another credit card in the near future. 

First off, request a copy of your credit reports and make sure the information is accurate. If there are errors, dispute them immediately. 

Increase your credit score and pay down debt, keep card balances low, and pay your bills on time. 

#13 Prepare Early for Taxes

financial checklist for 2020
Get your taxes prepared early so you aren’t stressing come April. Start saving now if you know you will owe taxes for 2019. 

#14 If Self-Employed, Pay Estimated Taxes Quarterly

financial checklist for 2020
If you are self-employed, make sure to plan for quarterly tax payments in 2020. 

The dates are as follows: 

  • Quarter 1: April 15, 2020
  • Quarter 2: June 15, 2020
  • Quarter 3: September 15, 2020
  • Quarter 4: January 15, 202

We recommend you talk with your accountant to make sure you’re on track with estimated taxes and won’t get stuck with a large tax bill come tax time.  

#15 Invest Your Tax Refund

financial checklist for 2020
There’s no better way to spend your tax refund than to invest in yourself and in your future. 

No matter how large or small your refund is, resist the urge to buy that new TV or use it for a vacation. 

Whether you invest it in your 401(k), IRA, or use it to fund your emergency savings, every little bit you save now may help you in the future. 

If you add to your 401(k), it needs to go through payroll deduction. 

Contact your Human Resources department, tell them what you want to invest, and they will take it out of your paycheck(s). 

Then use your tax refund to live on and make up the difference during this time.

#16 Update Beneficiaries

financial checklist for 2020
If you haven’t updated your beneficiaries in a while, the first of the year is the perfect time to review all accounts and make sure beneficiary information is accurate. 

If not, make the necessary updates as soon as possible. 

This means checking the beneficiaries on your 401(k), IRA, life insurance policies, investment accounts, and checking and savings accounts. 

#17 Seek Expert Advice

financial checklist for 2020
If you’re hesitant to reach out for advice because you think your account balance is too small and you need more money saved, don’t let that stop you from getting help!

This is your future we’re talking about. 

The sooner you seek expert advice, the higher the probability you’ll be better off financially in the years to come…and in retirement.

In fact, David Blanchett, Head of Retirement, CFP, CFA of Morningstar reported that participants that received expert guidance had as much as 40% more income during retirement versus those who received no help at all.⁴

Just think for a moment how 40% more income at retirement might change your lifestyle later in life. 

Chances are, it would make a significant difference. 

It doesn’t matter how much or how little money you have saved for retirement, or how much debt you are carrying…

A third-party expert may help you create a plan to get out of debt, fund your emergency account, and maximize your retirement savings. 

The sooner you reach out for help, the better off you may be. 

Don’t know where to start? 

Click here to download our no-cost guide: The Different Types of Licenses Financial Advisors Have and What They Mean to You.
financial checklist for 2020

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  4. David Blanchet, Morningstar Analyst 2014, “The Impact of Expert Guidance on Participant Savings and Investment Behaviors”



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