Here are eight areas to focus on for a bright financial future:
1. Legal matters: See a lawyer and make a will. If you have a will, make sure it is current and valid in your home state. Make sure you and your spouse have reviewed each other's will -- ensuring both of your wishes will be carried out. Provide for guardianship of minor children, and education and maintenance trusts.
2. Debt: Pay off your credit cards. Forty percent of Americans carry an account balance. Create a systematic plan to pay down balances. Don't fall into the "0% balance transfer game," as it will hurt your FICO score. Credit scores matter not only to credit card companies, but to insurance companies as well; you can avoid an unpleasant increase in your insurance rates by managing your credit wisely.
3. Insurance: Buy term life insurance equal to six to eight times your annual income. Most consumers don't need a permanent policy (such as whole life or universal life). Also consider buying disability insurance; think of it as "paycheck insurance." Stay-at-home spouses need life insurance, too! Note: Each family's needs are different. Some families have a need for other kinds of life insurance, so you should review your situation carefully with an insurance professional or two before making decisions in this area.4. Planning for lean times: Build a three- to six-month emergency fund. Establish a home equity line of credit before you need it -- this can take the place of part of your emergency fund, if necessary. In addition, continue learning throughout your life -- this will help you to be prepared if you are forced to make a career change.
5. Retirement savings: Fund your IRA each and every year. If you don't fund it annually, you lose the opportunity. Fund a Roth IRA over a traditional IRA if you qualify.