STATE — What better time than spring to get your budget in order, payoff lingering debt and freshen up your investment portfolio?
While consumers are tracking down and sorting through their financial documents from the past year for tax filing purposes, Provident Bank recommends taking advantage of this busy time by organizing and refreshing your finances.
“With your financial documents already handy during tax season, it’s an ideal time to review your finances and make adjustments for the future,” said Chris Martin, president and CEO of Provident Bank. “You may even find some additional deductions to claim on your tax returns during the process.”
These eight tips from Provident can help consumers get started:
- Claim your mortgage deduction: According to the Internal Revenue Service, only 32 percent of taxpayers in New Jersey claimed the mortgage interest deduction last year. By leaving this out, homeowners may be missing out on a chance to lower the cost of carrying a mortgage.
- Sweep up lingering debt: Take any opportunity to build equity and get rid of debt. While deposit rates remain low, use excess cash to pay down the principal on an existing loan or line of credit. Once debt is paid off, utilize the money that was budgeted to start an emergency fund for unexpected expenses.
- Build your retirement: Check out the status of your retirement savings, both for 2012 and for 2013. For example, you can make contributions to your IRA for the 2012 tax year through April 15, 2013.
- Review your credit report: An annual review of your credit report can help identify potential errors that, if fixed, may improve your credit score.
- Clear the clutter: Switch to paperless statements and enroll in online banking to help reduce paperwork. Receipts and paper statements that are more than three years old should also be sorted and shredded to make room in your filing cabinet.
- Assess investments: The spring is a good time to set up an annual review of your investments, particularly since you can consider investments with your taxes. If you have a financial adviser, schedule a time to meet with them to go over your investment accounts.
- Cancel unnecessary recurring debits: Review your most recent bank statement to see how many services are automatically debited and are never used – and cancel those unused services. Use the extra funds in your account to pay down debt or build up savings.
- Save important documents: Not just for next tax season, but in case of emergencies. Life insurance policies, savings bonds, deeds and property titles should be stored in a safe place – preferably not in your home. Talk to your bank about opening a safe deposit box so your important documents are secured.