17-25 Organize
Finally, the asset that most households fail to manage at all is their credit. Your credit score, or FICO--a three-digit figure from 300 to 850, with 850 being the best--will determine not only your interest rate on a mortgage or car loan but whether you'll get a loan at all. Your FICO is based on information found in credit reports maintained by the three major credit bureaus: Experian, Equifax, and TransUnion. Yet studies have shown that nearly a third of all credit reports have some discrepancies in them. It's your job, unfortunately, to make sure they get it right.
By the end of 2005, a new law will allow consumers a free annual copy of their credit report from one of the three credit agencies. For a fee, the three offer an automated system that notifies you via E-mail whenever credit information is added to your file. Don't let a small oversight torpedo your financial success. -Paul J. Lim
18-22. Saving money
18. Cut back on the fees. You can't change the stock market, but you can decide what percentage of your winnings brokers and mutual funds skim off the top.
19. Rebalance investments. At least once a year, take some of your winnings from a hot asset (like equities in 2003) and invest in an underperforming asset (like bonds).
20. Freeze your credit cards. Literally: Put your plastic in a bag, then freeze it in a container of water. If you get the urge to splurge, at least you'll have to wait for it to thaw.
21. Plan for the worst. Ready for that financial disaster? Set aside three to six months' worth of expenses--in a money market account, where you won't be tempted to spend it.
22. Refigure your FICO. How do you improve your FICO (credit score)? Get credit card balances down, pay all bills on time, and don't seek more credit than you absolutely need.
23. Make an emergency plan
Like most Californians, Robin Ibrahim, her husband, and their three young daughters were asleep when a massive earthquake wracked the Northridge area in the wee hours of Jan. 17, 1994. Ibrahim, a University of California-Los Angeles extension manager, was moderately prepared for the disaster, but after the quake she decided she needed to step up her efforts: "It's not just myself anymore; it's my family I have to worry about."
Exhausted by terror alerts of all hues? Bracing for the next flood/hurricane/tornado/earthquake? Still recovering from the blackout of '03? Rather than going through life in a miasma of anxiety, you can take a few simple steps to prepare for the worst--and put your mind at ease once and for all.
That doesn't mean outfitting your home like a forward base in Iraq's Sunni Triangle. "We don't need to protect ourselves from every weapon or disaster," says Henry Fischer, director of the Center for Disaster Research and Education at Pennsylvania's Millersville University. "But heck, we can have the basic supplies to keep us alive and safe for 72 hours" --the amount of time emergency planners estimate it would take to get basic services running again after a disaster.
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