Top Tips to Improve Your Finances This December
Another year in the books. It’s time to enjoy some Christmas cheer and merriment this December.
Before we move on to 2022, there are a few steps you can take to make sure your finances are ready to ring in the New Year.
Guard Against Inflation
Inflation is on the rise and purchasing power is dwindling. How can you protect your family against the rising costs of goods and services? Focus on your budget, prioritize your family’s needs, and work with a trusted professional to collaborate on a game plan.
Reduce Your Taxes
One of the best things to do at the end of the year is tax planning. I encourage everyone to work with a Financial Planner who specializes in tax planning. Remember, your CPA or tax preparer is working to keep you in compliance with current tax law. You need someone to help you plan ahead, too.
Maximize Retirement Contributions
Contributing to a retirement account helps prepare for your future, and might even help lower your tax bill, no matter where you are in your career. If you’ve been able to save some extra money this year, consider putting those funds towards retirement. You can contribute up to $19,500 (or $26,000 if you’re 50+) to an Employer Plan and up to $6,000 (or $7,000 for 50+) to your IRA. Those who are self-employed have many options as well.
Use Up FSA Funds
Depending on your health care plan, you might have extra funds in your flexible spending account (FSA). Unlike a health savings account (HSA), money set aside for your FSA typically does not roll over to the next calendar year. Generally, you will want to use up those funds by the end of the year. If you’re anything like me, you have some lingering dental work to help use up those funds.
Focus On 2022
December is a great time to review your Financial Plan. Look at the progress you’ve made. You might need to make some changes and correct course, or you might have some extra money saved up for a well-deserved splurge. 2022 might be more complicated and if you are not starting early, you could fall behind.
If you’re flying blind, I encourage you to find a Fiduciary Financial Advisor whom you can trust. Get started on a plan so you can have confidence in your future.
Here’s your list, so be sure to check it twice. Once you’re done, it’s time to sit back and enjoy the Christmas season with your loved ones!