Year-end money moves to make before 2022
[ad_1]
RgStudio – E+ | E+ | Getty Images
Be prepared for holiday costs
You can take a look at what you have spent during the holidays to help you plan what to do when January bills come in.
Make a plan for paying off any existing debt. Abbey Henderson, chief executive officer of Concord’s Abaris Financial Group, stated that it is important to pay down your highest-interest card as soon as possible.
You can consolidate debt that is excessive by using a balance transfer card, which has a low or zero interest rate, or a personal loan.
She said, “Consolidate for as long as possible and you are able to pay it off.
Review your budget
Valeriy_G | iStock | Getty Images
How much did you spend this year on your purchases?
Look at your credit card statements — many lenders even break down the expenses by category for you. Look at your credit card statements to see where adjustments can be made for next year.
You might consider starting a side-business to earn more income, and asking for raises. finding a new job. The months of January and February are best times of yearTo job-hunt, because this is when the hiring budgets for companies are most likely to go into effect.
Take a look at medical costs
Keep money available in your flexible expenditure account if possible. You might also want to go to the doctor or purchase qualified products so you can get reimbursed for any missed appointments.
The legislation passed late last year permits you to carry over any unutilized funds. FSA fundsYour employer must choose to participate in the 2022 election. Some employers allow you to keep more than $550 or give you a grace period. Check with your employer if there is money left in the account.
Maximum your retirement contribution
Employee-sponsored contributions have a maximum annual limit retirement plansA 401(k) is $19500 for this year and $26,000 for those 50 years or older.
Maximize your contribution if you are able. Winnie Sun, managing director and co-founder of Sun Group Wealth Partners, Irvine, California, advised that even if you are unable to make a full contribution, you should at the very least contribute enough to receive your company’s match.
Sun declared, “That’s your money.” Sun said, “Don’t forget it.”
If you are already maxing out your 401k or do not have one, then make the same contribution to your Roth IRA or individual retirement account. You can contribute $6,000 this year, and $7,000 if your age is 50+.
Sun stated that even though your April 15 deadline is for you to set up your retirement savings account for 2021 you can do it now to save for 2022.
Automate
Although people may have good intentions at the start of the year to improve their financial lives, they often find that things fall apart over the course of the year. Henske recommends that you set up automatic transfers to move money from your checking account into your savings and investment accounts.
“What some people do is to hem in on the amount,” he stated.
Henske said, “Be okay with spending $25 per month. Just get it hooked up and running.” You can easily change your monthly budget from $25 to $250 by going in.
For next year, make sure to check the status of your 401k contributions. Although the IRA limit is unchanged at $6,000 per year, it is rising for 401(k). $20,500. For those over 50, the catch-up limit remains at $6,000.
SIGN UP Money 101 is an 8-week learning course to financial freedom, delivered weekly to your inbox.
CHECK OUT: Former financial advisor who’s managed over $140 million: Here’s my best advice for new investorsWith Acorns+CNBC
Disclosure: Comcast Ventures and NBCUniversal are both investors Acorns.
[ad_2]