Take Care Of Financial Chores Now Consider Establishing A Roth Ira; Adjust Savings To Pace Inflation Rate;

The holiday hassles are over. Investors just finished a terrific year. Consumer confidence is soaring. Spring is right around the corner. Everything is wonderful.

Gee, what a great time to list all the chores that are piling up.

Actually, I kind of like putting my to-do list together at the start of the year. It gives me a great sense of being in control - and it will be months before I start feeling guilty about getting behind.

So here’s a list of personal-finance matters you might put on your list:

Adjust your savings plan. Increase your regular savings by 2 percent to counter last year’s inflation. If you don’t do this every year, even modest levels of inflation will eat deeply into your long-term returns.

Rebalance your portfolio. The rapid rise of stocks last year may have left you with a larger percentage of your assets invested in stocks than you’d planned. So sell some stocks or stock funds and move the money to bonds, cash or other assets that have fallen below your planned percentages.

Assess your investment performance. Compare each investment to a suitable benchmark. Stocks and stock funds, for example, should be measured against the Standard & Poor’s 500 (up 31 percent last year), or against other stocks or funds of similar types. Use the 1099 forms that will come this month to figure how income and capital gains taxes are reducing your return. Consider changes if you are trailing the benchmarks.

Consider a Roth IRA. These new individual retirement accounts offer tax-free growth, while taxes are merely postponed in traditional IRAs. Your mutual fund company or broker can help you determine whether you’re eligible to open a Roth, whether you’ll do better in a Roth or traditional IRA, and whether you should transfer old IRA assets into a Roth. Parents also should look into the new education IRAs that offer tax-free investing for college.

Start organizing your taxes. The new tax law will make some calculations more difficult, especially those involving capital gains.

Start a list of expenses. Most of us can save substantially by trimming incidental expenses such as lunches and sodas. Look for items that are easily foregone, replaced more cheaply, or simply don’t give much value or pleasure for the cost.

List things that require regular attention, such as oil changes or furnace filters.

List special expenses you may face this year, such as a new car, a lawn mower or water heater. With planning, you can keep an eye out for good deals and prevent these expenses from bunching up.

Plan financial-aid maneuvers. Parents can increase their eligibility for aid for college expenses by reducing income the year before aid is needed. Your income in 1998 will determine how much aid the family can receive for the 1999-2000 school year. Applications for aid in the 1998-1999 year should be filed as early this year as possible, because early applicants often get more aid.

Buy a computer. Personal finance programs such as Quicken and Microsoft Money can walk you through complex financial calculations that once were all but impossible for nonprofessionals. There also are many excellent tax-preparation programs such as Quicken Turbotax and Kiplinger TaxCut, as well as many good financial services on the Internet.

Assess your career. The job market is much improved. This may be the year to ask for a raise or move to a better job. Start early, as many companies are on calendar-year budgets and feel wealthier at the start of the year. Job hunting is difficult when bosses are off in the summer or during the holidays.

Examine your insurance. Your house may have appreciated in value. Is your insurance still adequate to replace it? Is your car insurance sufficient? How much can you save by raising your deductible? Do you have enough life insurance? Should you take out disability or long-term-care insurance? Should you get an umbrella liability policy?

Organize your record-keeping system. Make sure receipts, warranties, credit card and investment statements don’t go awry. An accordion folder or box with manila folders will help you keep everything in place. It’s best to keep just about everything pertaining to your house and investments.

Check your will. Make sure it’s up to date. Decide whether you should set up a living trust to minimize hassles for your heirs.

Make sure investments are in the correct name. Couples with assets that are not subject to estate tax, which begins with amounts over $625,000, should probably hold investments jointly. Couples with taxable estates may be better off using separate accounts so they can set up trusts that will reduce estate taxes.

Be sure you have listed the right beneficiaries. In addition to your life insurance, take a look at the beneficiaries you have listed for your retirement plans. Many people neglect to change these when they get married or divorced.