January marks the beginning of National Financial Wellness Month, a period where citizens nationwide take time out of their busy schedules to get their finances in check. And it's no coincidence that this month-long holiday takes place immediately following the Christmas season, as this is the time during which many Americans realize they've overextended themselves financially. Between shopping for gifts and throwing parties, expenses run rampant throughout December. Take stock of your bills immediately after the holidays and spend January cleaning up last year's mess while setting the stage for a fiscally responsible future.
It may seem scary, but now is the time to review the damage
If you haven't already, check your credit report, as well as your individual credit card and bank statements from December to make sure everything is accurate. This will not only help you get a better grasp on where you stand financially going into the New Year, but you will also be able to spot any charges that are either mistakes or signs of potential identity fraud.
Start the year off right by understanding where your credit stands
Since it's the beginning of a new year, you should also take this opportunity to view your free yearly credit report from one of the three credit bureaus, Equifax®, Experian® or TransUnion®. Not only can you verify the activity on this document and address any issues that may be a sign of potential identity theft, but you can also see where you may want to make changes over the next 12 months to put yourself in a better financial position.
Make a reasonable plan that will get you through the coming months
Once you have looked over these documents and taken note of any potential mistakes you may have made over the previous year, make a resolution to continue working toward a good credit score. If late payments have dogged your score in the past, then making a budget that can help you get installments paid on a fixed timeline going forward may be a good idea. Evaluate what debt you foresee paying off in the short term and what expenses will have to be tackled gradually, and work to have them taken care of before next December.
To help make your resolution come true, enlist in a credit monitoring service that can act as a second set of eyes in keeping you aware of certain changes to your credit. Should it appear you've deviated from your financial habits or that someone is taking advantage of your finances, the monitoring service will alert you, allowing you to resolve the damage before it gets worse.