Financial housekeeping for the new year: Part II

In part one of our three-part series on financial housekeeping for 2014 we write about checking your credit status and updating your budget. In this second part wel discuss taking care of your insurance needs. Part three covers reassesing your investments and examining your direct deposits, automatic payments, and other financial "systems."

Update your inventory

Got a new television or digital camera as a holiday gift? Now is the time to update (or create) your home inventory for insurance purposes. 

If you don't already have an inventory, you can use a simple spreadsheet or table from Microsoft Excel or Word, or similar applications in the free OpenOffice productivity suite. Place the file in a folder where you've put photos or videos of the covered items or rooms. Keep an up-to-date backup of the folder, including one in a location away from your home.

Another option is to use the free inventory service Know Your Stuff from the Insurance Information Institute.

For more information about insurance, read our homeowners and car insurance buying guides.

Adjust your insurance

Now that you've updated your inventory, check your homeowners insurance coverage.

Do you need to increase it or perhaps add a rider to cover new valuables, such as fine jewelry or artwork? Have circumstances changed that would make you eligible for discounts? For instance, did you install an alarm system? The same goes for your auto coverage. Are you or your spouse now driving fewer miles? Is your teen driver getting straight A's in school? Letting your insurer know about either could result in a reduction in your premiums. And ask about other discounts.

Also, has your car aged to a point where you can drop collision coverage? We generally recommend doing so when the annual premium exceeds 10 percent of your car's value. Separately evaluate comprehensive, which protects your vehicle against non-collision damage and damage caused by an impact with an animal. It's typically less costly than collision coverage, so it might be worth keeping.

—Anthony Giorgianni