The (Underrated) Mid-Year Financial Checkup

There's a ton of content around organizing/thinking about your finances at the end of the year. It's understandable, with a new year on the horizon, everyone starts thinking ahead about their current state of affairs, their goals, and their money aspirations. And you start fresh in January and you're motivated and then what?

Life happens. Unless you're hyper-focused on a specific financial goal (like paying off debt, or saving for a house to buy within the year), you likely go into maintenance mode with your money. And then half a year goes by and you're wondering how things stand: enter the mid-year financial checkup.

Which no one talks about, by the way. So here I am and I am going to share with you the quick-and-dirty of how I do mine and how I use it to recenter myself for a strong second half of the year.

The Mid-Year Financial Checkup Check List

(Say that subhead five times fast….ha!)

Around the mid-year mark or so (if I haven't already) here's what I'm doing:

• Looking at my income and expenses
• Updating my budget
• Reviewing financial goals and progress
• Reviewing debt and payoff plan
• Checking my savings/investments (updating my net worth)
• Planning for any big expenses in second half of the year

And if I needed it, I'd also add in the following

• Evaluate insurance coverages
• Hire professional help (if needed)

I review each step in more detail below.

Look at Income and Expenses

This is really the biggie and (at least in my view) the reason why you do your mid year check-in: to make sure you're spending is in line with your budget. It's important to do the following:

Income Review: List all sources of income, including salary, side gigs, investments, etc. Compare this to what you expected at the beginning of the year.

Expense Tracking: Review your spending over the past six months. Categorize your expenses (e.g., housing, groceries, entertainment) and identify any areas where you may be overspending. For me, I'm really looking at how my spending compares to the more “flexible” categories like travel, clothes, and home projects to make sure that spending is in alignment with what I planned.

Update Budget

I then take what I've reviewed from my spending and update my budget. In your own world, based on your expense analysis, adjust your budget categories as needed. Allocate more funds to areas where you may have under-budgeted and cut back on areas where you overspent.

Also, if your income has changed, adjust your budget limits accordingly. (This rarely happens for me, but is always fun when it does come around! How often do you get to say, “it's okay for you to spend more.”?)

Review Your Financial Goals

At the start of every year, I set financial goals and I plan that in some form or fashion, those goals will take me the entirety of the year. Depending on what my life is like at the time, my goals vary: these could include saving for a vacation, paying off debt, building an emergency fund, or investing for retirement. I have a great primer on how to set financial goals here.

I then determine how much progress I've made towards each goal. Ask yourself: are you on track, ahead, or behind?

I then go into my trello board where I list each financial goal and get to have a very satisfying time checking all of the ones I accomplished in the first half of the year off. Sometimes I also remove goals that are no longer relevant/important to me, or adjust them based on how much progress I feel I'd be able to make in the remainder of the year. This is okay!

Review Your Debt

Perhaps paying down debt is your “big” focus for the year. If it is, you've likely reviewed your progress when you were digging into your financial goals. But if debt payoff is more on the back burner, but you're still carrying some debt (like student loans, mortgage, etc.) it's also good practice to spend some time reviewing those balances at the mid-year point.

Debt inventory: List all your debts, including credit cards, student loans, mortgages, etc. Note the interest rates and balances.

Repayment Strategy: Assess your debt repayment strategy. Are you focusing on high-interest debt first? Consider making extra payments in the second half of the year if you have the means to do so.

Check Your Savings and Investments

I know everyone likely has some financial goals related to saving for retirement and their emergency fund, but I also like to check the balances on those accounts in June/July to see how they're doing and how much money they've earned in interest.

Ensure your emergency fund is adequately funded. A good rule of thumb is to have 3-6 months' worth of living expenses saved and if you're a little under, make an action item or year-end goal to get it back up to the six month mark.

Review your retirement accounts (401(k), IRA, etc.). Are you contributing enough to meet your retirement goals? Consider increasing your contributions if possible. It's also important to check on the health of other Investments (stocks, bonds, real estate). If needed, make adjustments if necessary to align with your risk tolerance and financial goals.

I also actively track my net worth each quarter, and I so I get to update the tracker again at the mid-year point. You can get the net worth tracker I use in my Financial Best Life Blueprint, available in my shop here.

Plan for Upcoming Expenses

A lot can happen in six months. New opportunities arise all the time and it can be hard to know in January what's coming for you and your family in June – either good or bad. That's why at the mid-year point I always look at upcoming major expenses in Q3 in Q4. If they're new, I make a plan for how to cover them, or if they've been on my radar for a minute, I check to make sure everything is on target.

For example, my partner and I added a trip to London in November and at my mid-year checkup I added a savings goal in Qapital to start saving for those expenses so I can indulge debt-free when we go. My partner and I also added in a plan to get a (surprising expensive) storage shed put into our back yard so our yard tools are protected come winter.

Evaluate Insurance Coverage

This is any every-year kind of thing, but it's good if you're taking a minute with your finances to review your health insurance, too. Are you taking advantage of all benefits? Do you need to adjust your coverage?

It's good to check your auto, home, life, and any other insurance policies. Ensure you have adequate coverage and shop around for better rates if necessary. I always shop for new rates when my insurances expire in October, but if yours are up for renewal at this point – add it into your mid-year checkup.

Seek Professional Advice

Again, If you're unsure about any aspect of your finances, consider consulting a financial advisor. They can provide personalized advice and help you stay on track. For example after my own mid-year review, I recently realized the need to engage an attorney to help with my will and trust for my son and a co-habitation agreement for my partner, so we did it.

Never be afraid to bring in the big guns. Yes, they cost money, and that sucks. But it's nice to have the peace of mind and not have to engage with the details on top of my already busy job and life. I'm into not trying to be an expert these days.

The TL:DR

I hope you found this post helpful and that it (at the very least) provided some “food for thought” in terms of how you think about money. It's great if you budget and track expenses each week or month, but that may not work. Bare minimum, if you're checking in with your money in January and June, that is the beginnings of a great money system.

It's important to find moments where you're allowed to reflect on your financial journey and progress. Don't forget to take a moment to celebrate the wins, too!