Editors' pick: Originally published Dec. 18.

The new year is approaching fast, so it's a great time to do some house cleaning and fitness preparation. I'm talking about financial house cleaning and financial fitness. The end of the year is the perfect time to take a look at where you are when it comes to retirement and make adjustments, financial planners say.

"It's a great time to make a new year's resolution about increasing what you are putting into your retirement plan," says Christine Marcks, president of Prudential Retirement. "Some people plan all year round. That's the exception rather than the rule. Take a couple of hours, sit back and look at what you've got."

"We're trying to focus people on simple steps they can take that will help get them better prepared for a retirement that's probably going to last 20 or 30 years," she adds. "Can you put 1% more a year away? If you have employer-sponsored plan and you are contributing 5% or 6%, can you increase that by 1% beginning with new year. It's a simple step, but if you get in habit every year of making resolution, it is a good financial habit to have." 

Laurie Blackburn, vice president at Speck - Caudron Investment Group of Wells Fargo Advisors, says the end of the year is the perfect time to check your asset allocations.

"92% of your performance is the result of asset allocation," she says. Contributions should be reviewed on an ongoing basis. Make sure you don't' have over-concentration in one area, particularly company stock." If your company provides the 401(k) match with its stock, you may be at risk, she says. 

It's the perfect time to review you investments, says Marcks. "Look at how you are invested," she says. Typically, your investments should reflect how ready you are to take risks. But you want to have a mix of investments. The mix probably depends on how old you are and what your savings are. What we find is helpful is target date funds, where you invest in a fund linked to the time you may retire. The money is invested depending on how far away you are from retirement. It's a simple way of investing which means the average person doesn't have to be an expert and try to time the market."

Bob Stammers, director of investor engagement for the CFA Institute, says only 22% of Americans say they are ready for retirement, and only 10% have calculated what they need to live in retirement.

"Even though people may be saving and putting money into a 401(k), no one is doing much planning for retirement," he says. "Planning for retirement is marathon not a sprint. It's really all about planning and understanding yourself and how you can best position yourself for retirement.

"The first thing is for people who haven't started planning, this is the time to start," he adds. "It's a good New Year's resolution for people who haven't started planning?"

Blackburn says you also need to think about having an emergency budget to plan for major, unexpected expenses.

"Talk about what's going on in your financial life in next couple of years," says Blackburn. "Think of an unusual expense you should plan for. I want you to be growth investors, but if you need to spend $30,000 to major project, that should not be in your growth portfolio. That should be in cash."

"The last thing is: review your financial behavior," says Marcks. "A lot of people make new year's resolution and want to get physically fit. We talk about getting them financial fit. It means saving more. Are you spending more than you should be? Is there impulse buying going on? If so, what can you do to curb that bad habit. Are you staying calm and focused on financial decisions as opposed to overreacting to how market behaves?" 

Part of improving revolves around planning. "Put a couple of hours in to determine your financial goals and that's a way to get financial fit," she says.

"If you are in a 401(k), make sure you are contributing up to the maximum," she adds. "If you have an employer match, take full advantage of what they will contribute. If they contribute up to 4% of your pay, make sure you are contribute at least that 4%. 

Blackburn, meanwhile, says it is time to review your retirement income plan. "See where you are with respect to your goals," Blackburn says. "Are you doing enough saving? Can you get estimates on when you might be able to retire and how much income you can generate based on retirement date. Sometimes people retire and then look at income. The closer you get to retirement, the more you need to focus on a retirement income plan. How much you can safely withdraw from your investments and have a sustainable amount."

"People don't understand what retirement means to you, what it will cost and how will you finance that over the years," Stammers says.

He says the end of the year is also a good time for people get educated. Many Americans lack the necessary personal finance knowledge.

"There are two sets of skills people need to understand," he says. "One is accumulation of capital. The other is personal finance skills. People, regardless of income, are very much lacking in budgeting, tracking expenses, and understanding what they need to do to maintain their lifestyle. They need to put savings on automatic so they can continue contributing for whatever their financial goals are. That a real discipline. It's not difficult, but it takes some energy and time and effort on people's part."