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NEW YORK, Jan. 19, 2004 - Small changes can make a big difference in your financial life, according to the ̽»¨¾«Ñ¡ Information Institute (I.I.I.).

"Some people think the only way to be economically secure is to win the lottery or marry a millionaire," says Jeanne M. Salvatore, the I.I.I.'s Vice President for Consumer Affairs. "But, in reality, organization, planning and little self-discipline can reap significant economic rewards."

To work toward a more secure economic future, the I.I.I. offers the following financial checklist:

1. Check your credit rating
   Your credit score has a profound effect on your financial life. Establishing a good credit history helps when applying for a job, renting an apartment, securing loans, signing up for utilities and even purchasing insurance at a competitive rate. Get a copy of one or all of your credit reports or access . Make sure they are accurate and report any mistakes immediately. The credit report helps you see how your credit standing compares to others. If your credit is not as good as it should be, learn how you can improve it by accessing the National Foundation of Credit Counseling , or the American Center of Credit Education at .
2. Analyze your debts
   Take a long hard look at the money you owe. Regular mortgage payments may not be fun to pay, but they are good debt. Routinely, running up credit card bills on restaurant meals or fancy clothes can be problematic. To maintain good credit, it's important that you pay bills and loans on time, make credit card payment when they're due while keeping the balances on those cards well below your credit limits. Having too many open lines of credit can hurt your credit rating too. Cancel the cards you never use and look into automatic payment plans that deduct money directly from your checking account.
3. Develop a strategy to save money
   Take the time to analyze your financial situation. Compare your earnings with your spending habits and regularly save for important goals such as:
   
   • Buying a home
   • Preparing for retirement
   • Saving for a child's education
   • "Rainy day" fund for unexpected events such as a job loss, un-reimbursed health insurance expenses or home maintenance issues that may need attention.
     Consider speaking to your insurance professional or financial planner about the many savings and investment vehicles available today.
4. Take advantage of employee or association benefits
   Each year your employer or union sends a huge package of information on employer-sponsored health plans, disability, long-term care and other benefits. Taking the time to review this information is very important. You may have a number of benefit options that can be financially advantageous to you. You want to:
   
   • Take advantage of 401K and other employer-sponsored savings plans. Many employers match a part of your contribution and it is a great way to accumulate savings, tax-free.
   • Know what is in your health insurance plan so that you can take advantage of flexible spending plans, know when you need prior approval for procedures before you have an emergency and take advantage of free programs to enhance your physical or mental health.
   • Look at group insurance plans that many employers and professional associations offer. Generally, they are available for auto, home, life and disability insurance. These policies can sometimes be cheaper and frequently can be deducted directly from your paycheck, which can be convenient.
5. Cut insurance costs
   You can reduce your home and auto insurance costs by following these simple steps:
   
   • Shop around for the most competitive price.
   • Take the highest deductible you can afford.
   • Maintain a good credit history
   • Take advantage of all available discounts.

6. Conduct a home inventory
   It is important that you document all of the things that you own and know their estimated value. You can do this by making a detailed list of your possessions or using a video/digital camera. Get into the habit of keeping receipts for major purchases and make note of serial numbers, manufacturers or other details for more expensive items. An up-to-date home inventory will help you:
   
   • Settle insurance claims much faster
   • Verify losses for income tax returns
   • Purchase the right amount of coverage for your belongings. If you have any items that are especially expensive, take special care to document this information. Some items such as jewelry may require additional insurance in the form of a floater or endorsement.

7. Disaster-proof your home
   Your home is both a financial and emotional investment. It is important to properly insure your home against a disaster, as well as making it as safe and secure as possible. This will not only keep you and your loved ones out of harm's way but also save you money on your insurance.

   To insure your home against a disaster:

   • Make sure that you have enough insurance to rebuild your home if it is totally destroyed and to replace everything in it.
   • Understand how much you would be reimbursed for "Additional Living Expenses." This would pay additional costs if you were unable to live in your home due to an insured disaster such as a fire or hurricane.
   • Look into flood or earthquake coverage. Neither of these disasters is covered under standard homeowners policies and without them, you could lose your most valuable asset-your home. Flood insurance is provided by the National Flood ̽»¨¾«Ñ¡ Program at while earthquake insurance is offered by private insurance, except in California where coverage is available through the California Earthquake Authority, a private/ public program.

   To make your home safe:

   • Consider installing alarm systems, as well as strong doors and locks.
   • Winter-proof your home to prevent burst pipes and other damage.
   • Trim trees near your home to avoid injury and damage to your home in car if there is high wind.
   • Prepare for hurricanes, tornados or earthquakes, depending on where you live.
     Reduce risk of fire. Install smoke detectors and know how to get out of your home in an emergency. Those living in areas prone to wildfires should take additional steps.

8. Protect yourself against lawsuits
   In our litigious society, an important financial protection is liability insurance. Fortunately, standard home and auto insurance policies include liability protection. It pays for both the cost of defending you in court and for any damages the court rules you must pay. To protect financial protect yourself:
   
   • Purchase more than the state-required amount of auto liability insurance. These limits are generally quite low. Instead consider $100,000 of bodily injury protection per person and $300,000 per accident.
   • Find out how much you currently have on your home or renters insurance policy. Most policies provide a minimum of $100,000 worth of protection. Consider purchasing at least $300,000 to $500,000 in coverage.
   • Consider an excess liability or umbrella policy, which provide a higher dollar amount than a standard home or auto policy and offer coverage for libel, slander, and invasion of privacy.

9. Guard against identity theft
   Identity theft is one of the fast growing white-collar crimes in the country. One easy way to avoid
   being a victim of this crime is to make sure that bank statements, old tax returns, credit card bills and other personal financial documents are destroyed. You may consider purchasing a shredder to make this chore easier. Also, be careful of receipts in stores and banks.
10. Write a Will
    When planning your finances, you also need to consider what you want to happen to your assets when you die or if you become incapacitated. If you have minor children or other dependents such as elderly parents, you need to decide who will care for them. To do this, you need to write a legally valid will, which should be reviewed if not written by a qualified attorney and be an integral part of an overall estate plan that includes consideration of how to minimize the tax consequences. If you don't, the state will step in and make these decisions for you. Not only will your wishes not be fulfilled after your death and a portion of your estate will be wasted on probate costs. You will also need to name an executor to handle the distribution of your property. You should also ask your attorney or estate planner about:
    
    • A durable power of attorney. This person will be legally empowered to handle your finances if you become too ill to handle them yourself.
    • Living will. This document would state your wishes if you are severely ill and a decision needs to be made about initiating or keeping you on life support.
    • Health Care Proxy. This person is designated to make medical decisions on your behalf if you are too ill to make them for yourself.

You can also get information from the American Bar Association at or the American Institute of Certified Public Accountants at . For more information on insurance, contact your insurance agent or company representative and access the ̽»¨¾«Ñ¡ Information Institute's website at .