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Time to Make Sure Your Fiscal Ducks Are in a Row

From: "Time to Make Sure Your Fiscal Ducks Are in a Row", Carolyn Bigda, Chicago Tribune, 8/16/09

The seventh-inning stretch: That's how I think of August in the financial planning calendar. Little more than halfway through the year, now is a good time to take stock of your progress toward your goals.

"It's always important to give yourself a little checkup," said Troy Von Haefen, a financial planner in Nashville, Tenn.

So pull out your account statements and ask yourself:

How much have I contributed to retirement accounts?

Given the stock market's volatility in the last year, you may be reluctant to put money in an individual retirement account (IRA) or raise the contribution to your 401(k) or 403(b).

But before you know it, it will be December, and you'll be scrambling to make up the savings.

"A lot of people go into a panic," said Morris Armstrong, a financial planner in Danbury, Conn.

So log in to your 401(k) account and see whether you need to increase your contribution rate (or begin).

For your IRA, you have until April 15 to make a 2009 contribution up to $5,000 this year or $6,000 if you're 50 and older.

And if you start saving little by little now, you'll minimize the effects of the market's swings, buying more stocks or bonds when they're cheap and fewer when they're not.

In which categories -- food, transportation, etc. -- am I spending the most?

Rather than simply cut back on spending, get smarter about it.

Pull together your checking and credit card statements for the last six months (most banks store up to six months of account records online). Place each line item into a category: car, travel, home, clothes and food, etc. Add them up to see where most of your money has been going. Don't like the results? You have time to make changes.

"It's all about making choices," Von Haefen said. "In my family, we'd rather cut coupons and save money at the grocery store so that we can enjoy the golf club."

For help with tracking your spending, use free online tools, such as and

How much am I paying in fees?

To make up for losses, banks have been furiously raising fees.

A report released this week by Moebs Services, which gathers data on financial institutions, estimates that banks will take in $38.5 billion in overdraft fees this year, up from $19.9 billion in 2000. An overdraft fee is charged when you spend more than the balance in your checking account. The median fee is $26, up from $25 last year.

Other fees also are on the rise: Some credit card issuers have increased the fee for a balance transfer, for example. The norm used to be 3 percent of the balance, with a cap of $100. Now, you may pay as much as 5 percent.

Take a close look at the fees you're paying, from annual charges to the interest rate on your credit card. If something isn't clear, call your bank for an explanation.

If you think a fee is unfair, ask for it to be waived or lowered -- though some banks are less willing to negotiate. In that case, search for a better deal at sites such as, and

And to minimize overdraft charges, have money transferred automatically from savings to checking when your balance runs low.

Written By: rnybeck
Date Posted: 9/22/2009
Number of Views: 2480