The sun's out, the days are longer, and there’s an undeniable energy in the air. Summer has this knack for making us feel motivated to press a reset button, and that’s where a mid-year financial review comes in. It’s like giving your money a clean slate so you can finish the year strong.
Trust me, the effort you put into this now will pay off in spades by December. I’ve been doing this for years, and it always helps me stay on track, avoid surprises, and find areas where I can improve.
Here’s how you can tackle your own financial check-up and set yourself up for financial success for the rest of the year.
Review Your Budget Performance
Summer has a way of sneaking a few extra expenses into the mix, doesn’t it? According to Prosper, between higher energy bills, summer camps, and travel, costs can pile up quickly. For instance, the average wedding guest spends around $610 on travel, attire, lodging, and gifts during the summer. That’s why it’s so important to check in on your budget now and make those mid-year adjustments.
Compare Actual Spending with Your Planned Budget
Go through your bank statements and compare what you planned to spend vs. what actually happened. Did you spend more than expected on entertainment or food? Maybe you underspent in areas like gas or clothing. The goal isn’t to make you feel guilty but to be realistic about where your money is actually going.
Tweak for Summer Spending
The summer months always seem to come with extra expenses. Whether it’s pool memberships, vacations, or higher electric bills (thanks, air conditioning), updating your budget now will help you prepare. For example, I recently moved “eating out” funds into my “travel fund” because we’re planning a beach getaway.
Buzz Bite! Did you know families can spend up to $2,000 on just one week of summer vacation? A little shuffle in your budget today can ease the strain later.
Assess Your Emergency Fund
Your emergency fund is your financial safety net, and it’s time to see if it can handle a surprise or two. I’ll admit, checking mine always feels a little nerve-wracking—did I save as much as I planned? Here’s what to do:
Check Your Balance Against Your Goal
Ideally, your emergency fund covers three to six months of essential expenses. Have there been any changes in your life, like a new pet or higher rent, that could bump up your costs? Adjust your savings target accordingly.
Plan to Catch Up if Needed
If you’re behind on your savings, don’t panic! You can kickstart it again by increasing your monthly contributions or funneling in the remainder of any tax refunds or bonuses.
Buzz Bite! Keep emergency funds in savings accounts that offer easy access and competitive interest rates. My go-to? High-yield savings accounts with no monthly fees.
Investment Portfolio Mid-Year Review
If you have investments, now is the perfect time to make sure your money is working hard for you. This isn’t just for Wall Street brokers. Anyone with a retirement account, like a 401(k) or IRA, can benefit from a review.
Rebalance if Needed
Take a look at how your investments performed in the first half of the year. If one part of your portfolio, like stocks, grew significantly, your risk may have shifted. Rebalance to match your original plan.
Check Retirement Contributions
I make it a point to increase my 401(k) contributions whenever I get a raise. Even bumping it up by 1% can have a big impact over time. If you’ve had extra earnings this year, think about doing the same.
"Your 401(k) is your best tool—always contribute enough to snag the full company match, and aim for the max if you can," says Peter Lazaroff, financial advisor at Plancorp.
Debt Management Progress Check
Debt can feel like a mountain to climb, but mid-year is a great time to celebrate your progress and adjust if needed.
1. Total Up What You’ve Paid Off
This part always fires me up. Seeing how far you’ve come—even if it’s just small payments chipping away at bigger balances—is super motivating.
2. Reassess Your Repayment Strategy
I’ve bounced between the “avalanche” (paying off high-interest debt first) and “snowball” (starting with the smallest debt) strategies depending on what’s worked best for my situation. Experiment to see what motivates you most.
3. Extra Payments with Windfalls
Did you get a refund, bonus, or gift? Put a little extra toward your debt instead of using it all for fun cash. It’s a game-changer, trust me.
Insurance Coverage Review
Insurance isn’t the sexiest topic, but it’s essential for financial peace of mind. Mid-year is when my family and I sit down to review all our policies (yes, I bribe them with snacks).
Check Your Coverage
Are your policies still enough for your current life? If you’ve moved into a bigger home or had a baby, your needs may have increased. Don’t forget to shop around for better rates once a year.
Update Beneficiaries
This is one most people overlook. Make sure your beneficiaries are current on all your policies so your money goes where you want it to.
Buzz Bite! The average household could save $850 annually by comparing car insurance rates between providers. A quick check could score you instant savings.
Tax Planning Mid-Year Adjustments
Taxes aren’t just a year-end chore. A little mid-year planning can save you both headaches and money.
Adjust Withholdings or Quarterly Payments
Life changes, like a promotion or side hustle, might leave you unexpectedly owing more at tax time. Adjust your withholdings now to avoid surprises.
Max Out Tax-Advantaged Accounts
Hitting the limits on accounts like HSAs or IRAs can lower your tax bill. I always evaluate around this time of year to see if I can throw in a little more.
Buzz Bite! Own a side hustle? Setting aside 25-30% of your side income is a safe bet for covering taxes. I’ve found this trick saves me a lot of stress.
Financial Goal Reassessment
Every major financial goal deserves a check-up. It’s like asking yourself, “Do my dreams still match my plans?”
Track Your Progress
Whether it’s buying a home or paying off student loans, look at where you stand. Maybe you’re ahead, or maybe you need to adjust your strategy for the rest of the year. Either way, realigning now can make a big difference.
Add or Swap Priorities
I once decided mid-year to spend less on dining out and save for a fall road trip instead. Those changes don’t feel like sacrifices when you’re trading for something meaningful.
Prepare for Summer Financial Challenges
Summer comes with some unique financial hurdles, but they’re easy to tackle with a bit of preparation upfront.
Budget for Fun
From vacations to kids’ summer camps, these costs can add up fast. I try to set aside a bit of “fun money” each paycheck starting in spring.
Seek Out Seasonal Side Hustles
I’ve picked up everything from freelance work to babysitting gigs during the summer. It can be a great way to offset extra expenses while doing something different from your usual routine.
Estate Planning Updates
Okay, this one isn’t exciting, but it’s necessary. Estate planning isn’t just about wills for the ultra-rich; it’s about protecting what you’ve worked hard for.
Care for the Details
Make sure your wills, powers of attorney, and trusts (if you have them) are updated. I once realized my will didn’t reflect a new family member—I was so glad I checked when I did!
Consult a Pro
If you’ve had big changes, like getting married or inheriting property, it’s worth sitting down with an attorney to ensure everything’s in order.
Financial Health Metrics Dashboard
Finally, give yourself a solid reality check. Metrics, like your debt-to-income ratio and your savings rate, can show you how healthy your finances are.
Compare Now to January
I love this step because it turns numbers into motivation. Did your savings grow? Is your net worth climbing? Celebrate every win, no matter how small. Then pinpoint areas to improve.
Set End-of-Year Goals
Maybe your goal is boosting your savings or slashing credit card debt. Write it down and revisit it regularly. This part always keeps me focused.
Your Mid-Year Money Reset
Now that you’ve done the heavy lifting, what’s next? Prioritize the big adjustments from your review and map out realistic, specific goals for the remainder of the year. You can even set quarterly dates to revisit your progress (add snacks if it helps!).
And hey, if you’re staring at a big mess and have no idea where to start, don’t sweat it. Consider bringing in a financial planner to guide you through the tougher parts. I’ve even leaned on professionals when things got overwhelming.
By taking these steps, you’re setting yourself up for a financially stronger, more confident year ahead. And that, my friends, is something to celebrate. Cheers to crushing your money goals!
