Mid-Year Financial Check-In: Your Guide to Smarter Money Moves

Summer is here. As we daydream about exciting getaways and lounging poolside with our friends, it's also a great time to hit "pause," reflect on your financial journey, and make any necessary tweaks.

A mid-year financial check-in can help you make steady progress on your goals and prepare for the months ahead. To make it easy, we've compiled a handy, step-by-step guide to do a thorough, top-to-bottom review:

1. Review Your Credit Report

Look over your credit report to help you maintain a strong credit score and understand what you can do to elevate it. Your credit report is a statement that contains all your credit account history, credit inquiries, public records like bankruptcies, foreclosures, and liens, and personal information such as your name, current and former addresses, birth date, Social Security number, and phone numbers.

When you apply for a loan or credit card, lenders and creditors will pull a credit check to review your credit. This can help them determine whether to extend to you financing and potentially what interest rates they'll offer.

To review your credit report, you can request free credit reports from the three major credit bureaus—Equifax, Experian, and TransUnion—through AnnualCreditReport.com. Currently, you can order one online report per week.

When you pore over your credit report, be sure to do the following:

• Make sure your personal information is accurate.
• Spot any unfamiliar or potentially suspicious accounts or activities like missed payments on accounts you haven't used or a spike in the number of recent inquiries.
• Look for any errors that could be negatively impacting your credit. Consumer Reports analyzed the Consumer Financial Protection Bureau (CFPB) complaint database in 2024 and found that mistakes on credit reports have increased more than 2.5 times in 2023 compared to 2021.

Ideally, you'll want to order a credit report at least once a year. It's also a good idea to get a credit report before applying for a job, an insurance policy, or some form of financing. During the summer, it is a great time to do a mid-year check-in to see if everything on your credit report is accurate, up-to-date, and has all the information there.

If you find anything inaccurate, missing, or not current when combing through your credit report, it's important to dispute them promptly. Under the Fair Credit Reporting Act, you can dispute incorrect information.

2. Adjust Your Budget

Mid-year is a great time to review your budget and make any necessary changes. Why's that? You can check how you're spending in the first half of the year and then make adjustments for the second half to stay on track. For one, after reviewing your spending during the first half of the year, you might find that you've gone a bit overboard in, say, eating out, entertainment, or clothes. If so, you can make trade-offs or find ways to reduce spending in these areas.

For example, if you're eating out each month and spending more than you have budgeted by about $100, you then know you need to cut back on eating out. Or, if you enjoy eating out and want to keep the spending amount the same, you can make trade-offs. Like negotiating to lower a few other bills like streaming services or cell phone plans, which can save you roughly $100. That money saved can cover your shortfall.

When you adjust your budget, you can set new savings goals – or tweak existing ones based on what's most important to you. For instance, maybe you're falling behind on saving for a new laptop. If so, you can scale back on spending in another area like those mentioned above.

3. Plan for Summer Spending

If you are not careful, summer activities can strain your finances. According to a report by Deloitte, U.S. consumers are expected to spend 13% more on summer travel this year than last year. Breaking down by income, consumers who earn under $100,000 a year are anticipated to spend an average of $3,790 on summer travel.

To enjoy the season without overspending:

• Set a specific budget for summer activities and stick to it. Just like other more expensive times of year – think back-to-school and the holidays – it's helpful to create a separate budget for summer fun. This can include summer-related travel, entertainment, eating out, camp, tutoring, and childcare.

If you have out-of-town visitors, this can also ramp up your summer spending. Consider folding in these added expenses, like entertainment and eating out.

• Look for free or low-cost events in your community. Having fun doesn't have to cost a pretty penny. You can look on social media, calendar listings, and community pages for inexpensive or free movie screenings, concerts and plays in the park, street fairs, and arts and crafts activities for the kids.

• Consider staycations or day trips instead of expensive vacations. Instead of spending a lot of money on an exotic getaway or overseas travel, plan a day trip or staycation instead. It'll be a fraction of the cost, plus you'll get to explore your stomping grounds and explore new sights.

4. Set up an Emergency Fund

Summer months can also be a good time to reassess your emergency fund. As you know, an emergency fund provides a financial safety net for unexpected expenses. To build one, aim to save at least three to six months' worth of living expenses. This may seem like a large amount, but you can start with $500 and work your way up to $1,000, $1,500, and so forth.

To make things easier, automate transfers to a dedicated savings account. Setting your savings on autopilot can help you make steady headway without stressing out or worrying whether you can afford to do so.

If in doubt, start small if necessary. Even small contributions can add up over time. For example, $10 a week equates to $520 a year. Bump your weekly automated savings to $20 a week, and that's $1,040 annually.

5. Set Credit-Building Goals

Lifting your credit score can open doors to better financial opportunities. With a strong credit score, you are more likely to get approved for the financing you need. Plus, you may be more likely to snag higher loan amounts, the best rates, and the lowest terms.

Lifting your credit score can open doors to better financial opportunities. With a strong credit score, you are more likely to get approved for the financing you need. Plus, you may be more likely to snag higher loan amounts, the best rates, and the lowest terms.

Here are some credit-building goals you can work toward:

Pay credit card bills and loans on time. To elevate your credit score, pay your credit card bills, car loans, personal loans, and student loans on time. Your payment history makes up 35% of your FICO Score, so staying on top of your bills helps establish a positive payment history.

Keep your credit card balances low. Reducing your credit card balances can help you lower your credit utilization ratio. Your credit utilization ratio, or credit usage, is how much credit you're using on all your cards against your total credit limit.

For example, if you have a $1,000 balance against a credit limit of $10,000, your credit usage is 10%. The lower your credit usage, the better impact on your score. Additionally, you could also pay less interest and fees by not carrying a balance.

Avoid unnecessary new credit inquiries. Each time you apply for a loan or line of credit, it can cause your score to dip temporarily, hurting your score.

A hard credit pull can cause your score to drop up to five points and impact your score for up to a year. It can stay on your credit report for up to two years. Plus, multiple inquiries at the same time can be a signal to creditors and lenders that you might be financially strapped and need to get quick access to funds. In turn, they might deny you financing.

There is an exception: If you're shopping for a mortgage or car loan, lenders will take note that you're shopping around for the best rates. In turn, there is a rate-shopping window where multiple inquiries count as a single inquiry. Regarding new FICO® scoring models, you might have up to 45 days to shop for rates. With older FICO Score and VantageScore credit models, you're looking at a 14-day window.

Final Thoughts

By taking these small steps, you can ensure your financial wellness is on track and make the most of the summer season. A mid-year check-in and appropriate tweaks can help you get aligned for the rest of the year and achieve your long-term financial goals.

About the author

A personal finance writer for over 8 years, Jackie Lam covers money management, lending, insurance, investing, and banking, and personal stories. An AFC® accredited financial coach, she is passionate about helping freelance creatives design money systems on irregular income, gain greater awareness of their money narratives, and overcome mental and emotional blocks.

Her work has appeared in publications such as Bankrate, Time's NextAdvisor, CNET, Forbes, Salon.com, and BuzzFeed. She is the 2022 recipient of Money Management International's Financial Literacy and Education in Communities (FLEC) Award, and a two-time Plutus Awards nominee for Best Freelancer in Personal Finance Media. She lives in Los Angeles where she spends her free time swimming, drumming, and daydreaming about stickers.

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