My suggested New Year’s resolutions, based on sharp advice from some of the best consumer advocates I know!
I always look forward to January, seizing it as an opportunity to clean my slate and start anew. This New Year is no exception.
To get a head start, I decided to seek out tips from some of my favorite consumer experts on how to save money and keep myself and my family safer in 2013. I plan to follow their advice — and hope you will, too. Happy New Year!
Managing Your Finances
Make 2013 the year you tackle credit card debt. “Look at your credit card statements and find the amount you’d need to pay to have your debt paid off in three years,” Detweiler says. Then make a plan to do so and try to limit your credit-card use along the way.
I had a friend who put her credit card in a can of water then placed the can in the freezer, so she wouldn’t be tempted to use her plastic. That’s courage.
Get organized. Keeping track of your finances is easier than ever, thanks to the proliferation of apps and computer-based budgeting programs. They can help you keep better tax records, track your spending, pay off debt and invest for retirement. “Getting organized saves you time and a lot of money,” Detweiler says.
Many big banks, like Bank of America and PNC, have “virtual wallets” that flag such money milestones as due dates for bills. And a variety of independent websites, like Mint.com, will aggregate your spending, debt and investments in one spot, making them easier to monitor.
Review your credit reports for accuracy. “A recent report by the Consumer Financial Protection Bureau found that 1 in 5 Americans have taken advantage of the yearly opportunity to review their credit reports for free through AnnualCreditReport.com, the federally mandated website,” Detweiler says. “That means 4 out of 5 haven’t.”
So take advantage of this service and order your free credit reports to check for mistakes that could affect your ability to get a loan or a credit card and to see if anyone has stolen your financial identity. Don’t ask for reports from each of the three major credit reporting agencies (Equifax, Experian and TransUnion) all at once. Instead, most consumer advocates recommend you space them out over a year, say one every four months, for timely assessments of your credit standing.
Protecting Your Identity
To learn the best ways for warding off identity thieves in ’13, I turned to the Privacy Rights Clearinghouse, a consumer education and advocacy nonprofit based in San Diego, and its director, Beth Givens, and its director of policy and advocacy, Paul Stephens.
Password-protect your smartphone. Your phone’s address book and apps are gold mines to thieves who can use them to tap into your financial accounts and to send phishing emails to your friends and relatives. So Givens and Stephens suggest you create a “hacker-resistant” password on your smartphone.
Passwords with eight or more characters are safer than shorter ones and made-up words are best, with a mixture of numbers and symbols.
Review the privacy policies of your phone’s apps. Find out how the app providers will use your personal information, avoiding apps that don’t have privacy policies. Also, “delete any apps you don’t need, since the more apps you have, the greater the chance of data leakage from your smart phone,” Stephens says.
Install mobile security software that lets you lock your phone remotely from another phone, computer or tablet. This can come in handy if your phone is lost or stolen. You can even wipe out data on the phone remotely.
Notify your financial services providers and employers if you changed your address in the past year. In January, these companies might be sending you tax reporting information, like Forms 1099 or W-2. Those forms contain your Social Security number; you don’t want that information falling into the wrong hands.
Saving on Homeowners and Car Insurance
If you’re like me, you probably don’t even think about your homeowners or auto insurance policy until you need to file a claim — or get hit with a rate hike.
But New Year’s is a good time to review your policies to ensure they cover your needs and that you’re not overpaying, says J. Robert Hunter, director of insurance for the Consumer Federation of America. Remember that you might be able to lower your homeowners and auto premiums by agreeing to higher deductibles. Here are his tips:
Learn what your homeowners and auto policies cover. If they’re too hard to decipher or understand (many are!), call your agent to ask questions. “Ask what the policy’s exceptions or limitations on coverage are and how much you’d receive if something were to happen,” Hunter says.