Do a Mid-Year Bennies Checkup

We're at the halfway mark -- how are your at-work benefits shaping up so far this year?

With six months of earning, saving, and spending under your belt, you've got a pretty good idea of how the rest of the year's going to play out. Now's the time to revisit those employee benefits you signed up for in January and do a little tweaking so you can make the most of your earnings for the rest of 2007.

Let's go to the tape...

Earnings re-cap

If you earn a steady paycheck (meaning one not dependent on bonuses or earnings that fluctuate from month to month), this is your chance to stop overpaying Uncle Sam (any more than you already are, that is).

If you got a fat tax refund last year (anything over $1,000) and have made no adjustments to your W-4 (and don't anticipate any major life changes), grab your most recent pay stub and last year's income tax return and head to paycheckcity.com for guidance on making withholding adjustments. To avoid underpayment penalties, shoot for the number of allowances that satisfies 100% to 110% of the prior year's tax payment (not counting your refund).

Savings strategies

Check your contribution balances on your at-work savings plan (e.g., 401(k), 403(b), or profit sharing). At the rate you're going, will you max it out before the first refrain of "Auld Lang Syne"?

The 2007 contribution limits are $15,500 (or $20,500 for those aged 50 and up), not including any matching contributions your boss kicks in.

It's also time to think about that IRA. If you haven't devoted any money to it yet, start automating this pay-yourself-big-time-in-the-future account and put it out of your mind. You have until next April to fund your account. So set aside $444 a month (if you qualify for the maximum contribution limit for '07 of $4,000) or $555 if you are age 50 or older (to hit the $5,000 savings ceiling). Even if you can't spare that much cash for the next nine months, sock away something. Trust me, you'll thank me in retirement.

Spending rundown

If you signed up for a flexible spending (medical and/or dependent care) account at work, start reaping the benefits of paying for necessities with pre-tax dollars. If you haven't already, gather your bills and submit those reimbursement forms. Then project the next six months of spending so you are sure to drain the account (since these plans do not allow carry-forwards on unspent money).

Review time well spent

It may be hard to motivate yourself to do a financial checkup with no looming deadlines. But doing so now can prevent trouble that is harder to remedy come December.

Consider how much time we devote to other important tasks. According to a recent Guardian Life Insurance Company survey, on average, American workers spend 1.4 hours reviewing their benefits, 2.7 hours preparing for Thanksgiving, and nearly five hours on holiday shopping.

If you spend an hour this month doing a mid-year financial status report, you'll have more time in December to fight the yuletide shopping crowds. 

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