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Leap Day financial touchstones

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By Andrew Housser

It only happens every four years – the 29th of February. So-called Leap Day marks a good occasion to take a leap into better organizing your money matters. Try these seven steps use this year’s extra day to improve your finances.

1. Review your bills and charge accounts. Look at your credit card and bank statements with a critical eye. What are your recurring charges? Do you still use services you are paying for? Are there better alternatives? With technology advances over the past few years, maybe you now can cancel your cable in favor of Netflix, eliminate your landline, or even cancel the gym membership if you use more online fitness tools. If you never get massages or listen to your 

music streaming service, cancel the fees. Then redirect the funds you save. Use them instead to pay off credit card or student loan debt, or to invest in your future retirement.

2. Review your credit report. You should be checking your credit profile at least once a year. Everyone can receive credit reports once a year at no charge. Reading over your reports can help you detect identity theft, or errors that damage your credit, as soon as possible. Correct any errors immediately.  

3. Check insurance coverage. Every few years, it is smart to check in and be sure you are getting the best auto and homeowner’s (or renter’s) coverage and rates. With digital technology, it is easier than ever to shop for new insurance coverage. You can compare quotes online and have brokers follow up with you at a time that is convenient for you. Also evaluate if you might need other coverage. Do you need a homeowner’s policy rider for valuables that you have acquired or inherited? Is your life insurance adequate – or have your dependents moved on, allowing you to drop your life insurance? 

4. Get wise to debt levels. More than 72 percent of Americans have at least one credit card. Among those who have credit cards, the average number of accounts is 3.7 credit cards. The more credit cards you have, the easier it can be to owe something on each card. Look back at your debt picture four years ago. Was it better or worse? Have you paid off debt, or added to it? If your balances are headed in the wrong direction, make a solid plan to repay your debt. If you can’t pay off your debt on your own, look into all options including debt negotiation, credit counseling, and consolidating your debt with an online lender. 

5. Shred unneeded documents. Financial experts have a range of opinions on how long you should keep most financial documents. The IRS generally recommends keeping tax returns and supporting documents for seven years. When you decide to get rid of old documents, make sure to shred anything with your account number, name or address to protect your identity. You should keep some documents forever. These include: birth, marriage and death certificates; divorce decrees; wills; Social Security cards; and military discharge papers. Keep vehicle titles, home loan documents and insurance policies as long as they are valid. 

6. Get rid of junk mail. Junk mail and catalogs can be bad for your financial health in several ways. Catalogs may encourage you to overspend by tempting you with items you would not otherwise consider. Junk mail also can compromise your identity. Visit the Direct Marketing Association’s website at www.dmachoice.org to opt out of most catalogs. You also can call the number on the catalog to unsubscribe. Change your financial documents to secure online communications, so you never have sensitive information sitting in the mailbox, vulnerable to thieves.

7. Clean up your passwords. Whether you manage your passwords for online accounts on paper, your computer or an online vault, it is a good idea to update the list periodically. Change passwords for financial accounts if you have not done so recently. Close accounts that you no longer use. Make sure an up-to-date list of accounts is available for your loved ones, and tell them where it is, in case of emergency.

Many financial experts recommend that you do these money tasks every year. But if that is too much for you, at a minimum, make sure to do it every time a leap year rolls around. Set aside a day or two now to tackle these tasks, so that you are caught up long before the next leap year cycle begins.

Andrew Housser is a co-founder and CEO of Bills.com, a free one-stop online portal where consumers can educate themselves about personal finance issues and compare financial products and services. He also is co-CEO of Freedom Financial Network, LLC providing comprehensive consumer credit advocacy and debt relief services. Housser holds a Master of Business Administration degree from Stanford University and Bachelor of Arts degree from Dartmouth College.
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