The new year is here. Are you looking forward to a brand new start, a fresh opportunity to throw old bad habits under the bus and don new healthy ones? By following our calendar of monthly tips, you could be in good financial shape when 2019 rolls around.
Get financially healthy, one month at a time
Now is the perfect time to get a budget nailed down. Don’t have one? This should be your top resolution! You can do it. Track your income and your outgo. If your outgo exceeds your income (or if you’re not saving as much as you’d like), then cut variable expenses or increase your income. But do make a plan for your money.
If you know you have a tax refund coming, be sure to file your return — pronto! The sooner you file, the sooner you’ll get your money back where it belongs — in your pocket. If your refund is substantial, you may want to adjust your withholdings for next year so you can hold on to your cash and use it to save, invest or pay off debt.
Take advantage of your company’s 401(k) plan. If your employer offers a match to your retirement plan contributions, sign up! This is free money, folks. Do not miss this opportunity. Invest all the way to the match, if you can.
Tax time! Make sure you file by April 17th or file an extension. (Like last year, in 2018 we get extra days to file. April 15th falls on a Sunday and the next Monday is D.C. Emancipation Day — a legal holiday celebrated in Washington D.C.).
Now that the rush of tax season is over, it would be a good idea to check your credit score. You can receive a free credit report from three big credit bureaus at annualcreditreport.com. Most credit cards also make at least one of your scores available (updated monthly) to account holders these days.
June is a month of celebrations. That time of dads and grads…and lots of weddings. Which means it’s time to double check that budget you created in January and see how you are doing. (Actually, you should be checking this monthly.) It may be tempting to splurge on amazing (and expensive!) gifts for dads, graduates and loved ones getting married, but don’t overdo. Stick to your plan.
Review your life, health and property insurance coverage and rates. Are you adequately covered? Getting good rates? Use an independent insurance agent to do some comparison shopping to make sure you’re getting the best deal possible.
With kids heading off to school, perhaps it’s time to start a 529 college savings plan for a child yet to go to college. Or use the 529 funds you’ve already saved for a current college student. A wise parent goes over budgeting skills with their kids before they leave for school (especially for new students). If you haven’t done that, now’s the time.
As a precaution, as much as you are able prepare for unfortunate, unexpected events in life. In the case of death, life insurance is your front line of defense. Make sure you have enough insurance to replace lost income and cover basic expenses, like paying off your mortgage, any debt, living expenses, college and even funeral costs.
The holidays are just around the corner, a notoriously expensive time of year. If you haven’t been setting aside extra cash to help pay for holiday gifts and entertainment — get started now. You and your January bank account will be much happier. One more thing — pay with cash and avoid that scary credit card bill.
Employers typically renew their benefit packages in November. Make sure you are set for the next year with medical, dental and vision plans that best fit you and your family.
Check your capital gain/loss situation for any taxable accounts and take advantage of tax-lost harvesting to lower your tax bill. Are you 70 ½ (or older) with a 401(k) or IRA? If so, be sure you have taken your required minimum distribution (RMD) for the year. Otherwise, you could be facing a painful (50%!) tax penalty. (If you are still working and are less than a 5% owner of the company, you are not required to take an RMD from a 401(k) account.)
Following these very doable tips throughout the year can only improve your financial health for the next year. And who doesn’t want that?
Advisory services are offered by Joslin Capital Advisors, LLC, an SEC Registered Investment Advisor.