How to Get Your 2022 Finances in Order

Balance transfers to cards with zero interest (for a limited time) are a smart idea, too. Then freeze your spending for 30 days, or however long you need. It might take some time, but these days, financial freedom is well worth it.

Increase Your Retirement Funds

Good news: the maximum contribution limit for your 401(k)s increases by $1,000 in 2022 compared to 2021, for a total of $20,500. If you’re 50 or older, the limit is $27,000, which is great for those closer to retirement. If you can’t max out your contribution, just increasing it by one percent can have an incredible effect. According to calculations from Fidelity Investments, if you’re 35 and earning $60,000, this tiny bump could yield an additional $85,000 to your retirement fund over a 32-year period. That’s equal to putting aside $12 per week (how easy is that?), assuming a 5.5 percent return and consistent salary growth.

Create a Back-Up Plan

This probably isn’t something you want to think about, but it’s necessary should something happen to you. Take few minutes to update your beneficiaries on all your financial accounts, including retirement, investment and benefits accounts. Next, make sure you have a durable power of attorney, someone you trust to take care of all your monetary affairs. After this, designate a health-care proxy or power of attorney, who can speak for you if you become incapacitated. Finally, update your will. Decide who will inherit your assets. If you have children, you can even assign guardians for them. In the long run, if the worst-case scenario unfolds, you’ll save your loved ones a lot of time and trouble.

Carve Out Time for a Life Audit

This task might sound big, but it’s necessary if you want to achieve your dreams – financial or otherwise. Start with a pen or pencil, about 100 sticky notes, a journal and a large space, perhaps a door, board or wall. Turn your phone off, then get started. Look back at your life. Assess where you’ve been, where you are and where you’d like to go, then brainstorm. Do you want to save a certain amount of money this year? Put away some cash for a dream trip? Learn a language? When you think you’ve finished, then organize your goals into three categories: personal, work/career and money. After that, further divide them short-term and long-term goals. Take a photo of your notes and keep it near to remind yourself of what you’re trying to accomplish. More often than not, your dreams involve money, which is directly related to your priorities and how you budget.

Budget for 2022

Now that 2021 is in your rearview mirror (and perhaps you’ve even done a life audit), take what you’ve decided upon and create a budget you can live with. Then, download a budget app to keep you on track. If last year’s budget worked well and you’re already on your way to living your dreams, just hit “repeat.” If not, make necessary changes. That said, no matter the status of your finances, it might be a good idea to increase your emergency fund, given all the uncertainty we’re facing in our world.

If you think about it, taking time in January to look closely at your finances is kind of like going to the doctor for your yearly checkup: You want to make sure there are no red flags you need to address. After all, your fiscal health might be as important as your physical health.

Sources

https://www.cnbc.com/2021/11/17/use-this-checklist-to-get-your-finances-in-order-before-2022.html

https://www.cnbc.com/2020/01/23/why-you-should-increase-your-401k-or-ira-contributions-by-1percent.html

https://www.fidelity.com/viewpoints/retirement/save-more

8 New Year’s Resolutions for Dealing with Debt in 2022

5 Affordable Ways to Share the Holiday Spirit

warm meal. You might also ask co-workers, local churches or homeless shelters if they’re looking for some extra sustenance during this time of year.

Create Necessity Bags

Giving to those on the streets during the holidays is an easy, inexpensive way to make a difference. Fill a gallon-sized food storage bag with things like gloves, toothpaste and toothbrush, hand sanitizer, sanitary wipes, bottled water, snacks and a gift card to a grocery store. Then contact your local organizations and charities to see where the needs lie. You might also carry these bags in your car and when you see someone, give it to them. Moments like these are invaluable to those in need and for you, too.

Volunteer Time

Showing up with an extra pair of hands is often what someone needs. A great place to check out is VolunteerMatch. Just type in your ZIP code and you’ll find all kinds of opportunities to help everyone from seniors to children in many sectors, including education, arts and health. You might also find ways to help animals or read to the blind. These are feel-good, money-free ways to experience the joy of giving.

Donate Craft Items

How many times have you thrown away your toilet paper rolls or egg cartons? This year, save and donate them to nearby schools or community centers. All it takes is a few phone calls to find out what their craft needs are. You’ll also be helping the environment – sharing some love for Mother Nature. How simple is that?

Declutter Your Dwelling

This one has so many terrific benefits. You can get rid of clothes and belongings that crowd your closets, which is a wonderful feeling. One option is to sell them on eBay Charity and donate to a nonprofit of your choice. You choose what percentage of the sale goes to the organization (from 10 to 100 percent). eBay will even give you a credit on your selling fees based on the percentage you choose. If you want to give away gently used professional clothes, Dress for Success and Jails to Jobs, are groups that empower people to look their best when making a fresh start. If you’d like to rid yourself of shoes you’ll never wear again, Soles4Souls is a great resource and you can ship up to 15 pairs of shoes without paying a fee through the Zappos for Good program. Talk about good for the sole, er, soul!

For the most part, should you choose to get into the holiday spirit with these activities (aside from a few costs here and there), the main thing you’ll be spending is time. However, experiencing the joy of the giving is priceless.

Sources

https://www.discover.com/online-banking/banking-topics/affordable-ways-to-spread-generosity-holiday-season/

10 Ways to Pay Off Student Debt Faster

refinancing at lower rates, ranging from 1.8 percent to 7.84 percent. But there’s more: Some lenders offer cash-back bonuses. With that said, the catch is you give up important benefits like income-driven repayment and student loan forgiveness. However, refinancing can help you save a bunch – like thousands of dollars.

Pay Bi-Weekly

If you can swing this, it makes good sense. Why? Interest on your student loan accrues daily. Just cut your monthly payment in half and make two payments per month. This way, it might be easier to juggle your finances, as opposed to doling out one big chunk every month. Also, paying more often gives you the feeling that you’re making progress – and you are because of the daily accrual. #WinWin

Use the Debt Avalanche Method

With this approach, you’re paying off your highest interest debt first. Makes sense, right? After you do this, make minimum payments on all of your other loans. If you have any extra cash left over, pay your highest interest loan. Keep at this until you’re paid in full.

Claim the Student Loan Tax Deduction

This is cool. You can write off up to $2,500 of your student loan interest. Now, the amount you can write off depends on your income because there are phaseouts and gradual reductions in place. Just use the 1098-E form (you can get this from your loan servicer) to figure out how much interest you’ve paid. Then get going.

Pay While Still in School

Talk about getting a head start.You’ll cut down on interest (a good thing) while forgoing in-school deferment, and start paying down your debt pronto.

Pay Off Private Student Loans First

Should you have public and private student loans, this is the best strategy. Here’s why: private loans don’t offer student loan forgiveness or income-driven repayment. And they have limited deferment options. You’ll be better off doing this, given all the stipulations that exist for these kinds of loans.

Use Employer Repayment Assistance Programs

This is a sweet deal. Check with your employer to see if they offer such a program. Generally, they offer reimbursement or allocate funds to help you. Don’t forget to ask!

Pay During the Grace Period

This is the six-month period after graduation. While this might not be something that’s initially appealing, think it through. It helps keep interest in check and prevents your balance from growing during your grace period. Also, starting earlier means you’ll finish earlier. Gotta love that.

Consolidate Federal Student Loans

This is a great idea for those with limited resources. You can lower your payment and extend the repayment terms. You’ll most likely pay more interest, but for a short-time solution it’s a good one.

Exceed the Minimum Payment

If you have the means to make this happen, by all means, do it. Another great way to make incredible progress is to make double payments. If you can’t pay double, at least try to pay over the required amount. It’ll help eat away at the interest and eventually, the principal.

Student loans are great while you’re in school, right? They enable you to get the education you want. And while paying them off might be overwhelming, if you use these methods, you’ll be ahead of the game and pay them off sooner than you think.

Sources

107 Ways to Pay Off Student Loans Faster (That You Can Start Right Now)

7 Ways to Save for a Home Down Payment

How to Catch Up on Your Retirement

cash value, consult your tax advisor or insurance professional first.

No matter what your situation is, you can save for your future. All you have to do is begin now and take it one day at a time.

Sources

https://www.investopedia.com/articles/retirement/08/catch-up.asp

https://www.kiplinger.com/retirement/retirement-planning/602191/401k-contribution-limits-for-2021

https://money.usnews.com/money/retirement/401ks/articles/how-to-take-advantage-of-401-k-catch-up-contributions#:~:text=The%20401(k)%20Catch%2DUp%20Contribution%20Limit%20for%202021&text=Once%20you%20turn%2050%2C%20you,temporarily%20shield%20from%20income%20tax

5 Tips for Job Seekers Over 50

illegal, it doesn’t mean it isn’t prevalent. You can’t turn back the clock, but you can reshape how you present yourself. Here are a few good ways to get started.

Learn New Skills

If you see a job posting in your industry that requires knowledge of the software you don’t know, hop on YouTube or enroll in an online class. Certifications help, too, and are available in some of the most in-demand programs, such as Amazon Web Services (AWS), Systems Applications and Products (SAP), Hootsuite (used for social media), and Salesforce. This way, you’re demonstrating to employers that you have the necessary qualifications for the job – you’re a viable candidate – and you haven’t fallen behind over the years.

Rethink Your Resume

First of all, limit your experience to the past 15 years, unless there’s a job that reflects a title or skill that’s relevant to the position. You don’t want to appear, upon first glance, overqualified. Second, make sure your CV includes the right keywords. The days of HR managers poring over resumes is mostly gone; they often use applicant tracking systems (ATS) to weed out the candidates that are filling up their inbox at warp speed. Finally, if you’re using AOL or Hotmail, get a new account; this is a red flag that screams too old. Sign up for Gmail instead.

Widen Your Net

Think outside your industry’s box. For instance, you might be attracted to a big-name corporation or a hot startup, but it might not be the right environment for you, especially if there’s a chance you’d report to a much younger manager. You might find a better fit by going outside your comfort zone. Colleges and universities might be good options; you can leverage your experience by teaching. Smaller companies or startups that aren’t as well known might also be good places to look; you could take on multiple roles. Being open to contract or freelance jobs is another good idea. Getting your foot in the door is half the battle.

Use Personal Connections

While job sites like Zip Recruiter and LinkedIn, leads on social media and head hunters are places you might have found opportunities before, reach out to friends and former coworkers. It creates immediate familiarity and, when faced with a sea of resumes, helps move your name closer to the top. When you do get introduced to someone who has an opening, ask about their industry, role in the company, as well as what tools they’ve used, podcasts they listen to, or online classes they’ve taken to keep current. This not only shows your business savvy but also could help keep you top-of-mind if they hear of anything.

Own Your Experience

Your age doesn’t have to be the elephant in the room. Demonstrate why the invaluable skills you’ve accumulated over the years differentiate you from others. Craft an elevator pitch and jump right in. Talk about how, for instance, your breadth and depth of knowledge can help junior executives learn and grow. Busy employers generally want to know how quickly you meet the job requirements and if you can make their life easier, or help them shine.

Remember, you have so much to bring to the table. That’s why serving up your accolades in the right way can make all the difference in the world.

Sources

https://www.themuse.com/advice/jobhunting-after-50-the-new-rules

5 Tips for Going Back to the Office

Calm, Headspace or Simple Habit. (These are also great when you get home and before you go to bed – anytime, actually.) You might also call a friend or family member and share how you’re feeling. Letting off some steam and expressing yourself helps alleviate some of the pressure that might be building up.

Communicate with Your Team

Making the transition back to the office can be challenging, if not downright tough. To diffuse any misunderstandings, practice transparency with everyone, no matter what their position. If you’re a manager, lay out your expectations so that everyone is on the same page. If you’re an individual contributor, make sure your manager and peers know what you’re working on, your hours, and any out-of-the-office days you have coming up. Many companies are asking employees, initially, to split their time between the office and home, which means that for some a full transition back to the office is yet to come. Regardless, overcommunicating will ensure you don’t miss out on anything important.

We may never return to the days before the pandemic. However, we’re making strides to get back to a place of normalcy and are here to guide you every step of the way.

Sources

Returning To Work In The Office? 5 Tips To Prepare For The Transition

6 Ways to Make Saving Money Fun

Acorns and watch your savings grow. Anytime you buy something, Acorns will round up the total and deposit the difference into a diversified investment portfolio. Talk about easy.

Weather Wednesday Challenge

This is great idea. Every Wednesday,look up the highest temperature in your state and deposit the amount into your savings account. For example, if it’s 100 degrees, deposit $100. If it’s 32 degrees, deposit $32. You’ll probably save more during the summer than the winter, but after 52 weeks, you could’ve socked away several thousand dollars. Pretty sweet.

Kick-a-Bad-Habit Challenge

Do you go to Starbucks every day for your Double Chocolatey Chip Crème Frappuccino with extra whip? How about guzzling those sodas every day? Are you a smoker? Whatever it is that you’d like to cut down on or even stop, this challenge has two great benefits: you’ll not only get healthier, but you will also save money.

The No-Spend Challenge

Start with a weekend (or even a week) and make a vow not to spend any money on anything except bills or other necessities. The idea is to save money by not spending it. It might cause you to be more creative. For instance, do you really need a new dress for that special occasion? Dig a little deeper into your closet instead of buying a new frock. Or maybe you decide to drive less and not put gas in the tank. This way, you’ll either bike or walk to your destination (if doable) and do more fun things at home.

The Pantry Challenge

Look inside your refrigerator and pantry. How much food do you have that you haven’t eaten? What about that spaghetti sauce or sesame oil? As long as the food isn’t expired, it’s your chance to get creative and whip up a new dish or revive an old favorite. This challenge is related to the “No-Spend Challenge,” and again, the intention is to save money by not spending it.

The 365-Day Nickel Challenge

Nickels are currency, too! But seriously, if you can remember to do this (set a timer on your phone), you’ll be rewarded handsomely. Here’s how it works: On day one, deposit 5 cents into a jar. The next day, 10 cents. The next day, 15 cents. And so on. By day 365, the total deposit will be $18.40. At the end of the year, you’ll have saved a whopping $3,339.75. Not bad, huh?

While saving money might feel restrictive, you’re actually planning ahead to be very happy. When you’ve been able to stick to a habit, or in some cases give one up, you’ll see that anything is possible if you just put your mind to it. And that’s a great feeling.

Sources

https://money.usnews.com/money/personal-finance/saving-and-budgeting/articles/money-saving-challenges

7 Ways to Save 10K a Year

TaskRabbit is a great resource to find all kinds of ways to increase your income.

Cut Unnecessary Expenses

Look closely at your expenditures. Decide if you’re really reading that magazine and think about canceling the subscription. Pack a lunch and/or cook in for dinner. Call your internet and cell phone provider to see if they have a better deal. If you want to add an extra $1,000 to your savings each year, all you have to do is cut out $84 a month. This is doable.

Commit to a Budget

Everything that means something requires hard work and commitment. Take an afternoon, put it all down on paper, and promise to live within a dedicated financial scope. Compare your short-term gratification to your long-term financial goal. Imagine how good you’ll feel when you’ve saved $10,000. The power of visualization works.

Track Your Progress

If you’re feeling overwhelmed along the way, it pays to go back and see how far you’ve come – and we’re talking literally see it. Make your milestones visible. Hang a chart in your kitchen and color it in when you make a deposit. Or if you’re more analytical, create a spreadsheet, but keep it on your desktop. Checking this every day will help keep you on point.

Saving for a goal like this can be fun and even exciting. All you have to do is be mindful, make a conscious decision to follow your plan, and your 10k dream will be realized before your know it.

Sources

How To Save $10,000 In A Year (10 Simple Tips)

https://www.bankrate.com/banking/savings/rates/

3 Best Ways to Save for College

Save for CollegeWhat if you could save enough for your child to go to college debt-free? It might sound impossible, but with dedication, hard work, and careful planning, you can do just that. According to Dave Ramsey, American personal finance advisor, here are the top three tax-favored plans to get started.

The Education Savings Account (ESA)

Otherwise known as the Education IRA, this plan allows you to save $2,000 (after tax) per year, per child. Let’s do that math. If you begin saving when your child is born and put away $2,000 a year until they’re 18, you’ll be investing $36,000. Not too shabby. And the good news is that qualified distributions are tax-free, which means you won’t have to pay anything when you withdraw the funds to pay for college. The other upside is, depending on the rate of growth, you’ll earn more than you would in a regular savings account. However, there are some caveats. You can’t contribute if you make more than $110,000 (single) or $220,000 (married filing jointly); the contribution cap is $2,000 a year; and the money must be used by the time your child is 30.

The 529 Plan

If you want to save more for your child’s education or you don’t qualify for the income limits of the ESA, then this might be a better fit because you can contribute up to $300,000, depending on what state you live in. Ramsey recommends you look for a 529 Plan that allows you to choose your investment funds. Also, he says most of the time there aren’t any income restrictions based on your child’s age; however, there are some limits, so choose wisely. This plan also grows tax-free. One thing to note: restrictions may apply if you want to transfer your funds to another child.

The UTMA or UGMA (Uniform Transfer/Gift to Minors Act)

One of the best things about these plans is they’re not just designed to save for education. For example, if your kiddo wants to take a gap year, this can cover living expenses. The account is set up in your child’s name but it’s controlled by a custodian (usually a parent or grandparent). The custodian manages the account until the child is 21 (18 for the UGMA). One of the pluses of this plan is that since the account is owned by the child, the earnings are usually taxed at the child’s rate, which is generally lower than that of the parents. For some people, the savings can be significant. However, there are two important things to know: (1) once your child is of legal age, she can use the funds however she likes (a trip to Europe, a sports car…or college?) and, (2) the beneficiary can’t be changed after selected.

While setting up a college fund is a smart goal, it’s not the only one. Prior to starting down these paths, Ramsey recommends that you consider paying off your mortgage, credit cards, and your own student loans. He also suggests setting up an emergency fund of three to six months and allocating 15 percent of your salary to retirement through a 401(k) and/or a Roth IRA. For more help, he recommends both parents and children read “Debt-Free Degree.” This book walks you through how to go to college without student loans.

Saving for an education might feel completely overwhelming, but if you start early enough, do your homework and create a solid plan, it’s absolutely possible.

Sources

https://www.daveramsey.com/blog/saving-for-college-is-easier-than-you-think

https://www.troweprice.com/personal-investing/accounts/general-investing/ugma-utma.html#:~:text=Because%20money%20placed%20in%20an,this%20savings%20can%20be%20significant.&text=Up%20to%20%241%2C050%20in%20earnings%20tax%2Dfree.&text=Any%20earnings%20over%20%242%2C100%20are%20taxed%20at%20the%20parent’s%20rate