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Special section 7 Bankrate experts with 7 top tips for '07

As you transition into 2007, it's a good time to take stock and make plans. Follow Dr. Don's advice to improve your finances in the coming year.

 

Improve your finances: Dr. Don's top 7 for '07

4. Opt out. Opt out of credit card offers, phone solicitations, and direct mail too. It's very easy to do. Just call(888) 5-OPT-OUT or (888) 567-8688)o opt out of getting unsolicited credit and insurance offers. Then scoot over to the FTC site to register your phone numbers on the do not call list. Finally, although it costs a buck, you can register with the Direct Marketing Association to reduce the number of consumer mailings you receive. It may be overkill if you've frozen your credit report, but not getting all that junk mail and nuisance telephone calls is a wonderful thing. Now if only the Sunday newspaper had more articles than advertising.

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5. Focus on health. My junior high school health teacher, Mr. Andrew Codispoti, was constantly telling his students, "Health is wealth; all the money in the world can't buy health." As the boomers who spent their youth in the 1960s approach their 60s it's a good time to reflect on what all of us can do to improve our health. Fad diets and best intentions aren't the answer. A healthy diet and an exercise program that you can stick with through the year works. Personally, I plan to schedule some long overdue appointments with doctors to get a professional opinion on the state of my health and work on that healthy diet and exercise program in months that don't end in "a-r-y."

6. Review/rebalance your portfolio. The stock market has been very good this year. OK, not as good as the late '90s, but most of the major U.S. indexes had double-digit returns year to date through mid-December.

Investment allocations in financial securities are typically split between stocks, bonds and cash. Cash is financial shorthand for money market debt investments with a final maturity of a year or less. The investment allocation that's right for you will depend on your risk tolerance, investment goals and market outlook. You may decide that an allocation of 50 percent stocks, 30 percent bonds and 20 percent cash is right for you. If this year's stock performance brought your stock allocation up to 60 percent, then rebalancing the portfolio will get you back to your target allocation.

For the do-it-yourselfer, there are a host of asset allocation work sheets available on the Web. SmartMoney.com offers two -- one for people approaching retirement and one for retirees.

Taxes and other considerations, such as estate planning, can influence your desire and ability to rebalance your portfolio. It's a good idea to consult with your financial planning professional and tax adviser before reallocating your investments.

7. Make a list. Put together a list of your accounts, insurance policies and other financial matters, such as where you keep your will. Don't have a will? Find a way to get one. This list will be invaluable to your family if you become incapacitated or die. They'll have enough to deal with without trying to piece together the puzzle of your finances. If you already have a list, take the time to review and update it to keep it current.

8. Bonus! Be a part of your community. Everyone wants to live in a great community, but people, not houses, make a community great. Be a better person and you get a better community. Volunteer your time and get involved in your community. You'll make a difference and feel great doing it.

To ask a question of Dr. Don, go to the "Ask the Experts" page and select one of these topics: "financing a home," "saving & investing" or "money."

Create a news alert for "saving"
-- Posted: Dec. 18, 2006
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