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Financial Check In: Are You On Track to Reach Your Year-End Goals?

The summer season is winding down and fall is fast approaching. Whether you’re excited for the cooler months ahead or still holding on to the last bits of summer, now is a great time for a financial check in. Below are a few ways in which you can take stock of your financial health and how it’s lining up with your year-end goals.

 

Review Your Budget

In 2020, many of us spent less on things like travel, vacations, eating out, entertainment, and the holidays. If you didn’t revisit your spending budget for 2021, pause now and take a moment to identify areas where you may be spending more (or less) than last year.

It’s possible your income stream may have changed as well – whether you received a promotion, started a new career path, or experienced  COVID-related job changes. If you’re still following the same budget as last year but your income has changed, reevaluate your budget immediately.

Evaluate Current Debt

Holiday retail sales hit a staggering $719 billion last year, meaning our spending won’t be slowing down anytime soon as we head into the holiday season.1 In fact, people expect to spend around $800 on Christmas presents alone – that doesn’t include holiday parties, decorations, travel, etc.2 With your spending likely to increase towards the end of the year, now is a great time to evaluate any current debt you may have accumulated throughout the year.

You may want to write down all debt currently owed including credit cards, student loans, mortgages, and car payments. Be sure to also keep track of the minimum payment amounts and due dates. Once you have everything laid out and organized in one place, you can begin focusing on how to minimize or eliminate certain debts. For example, if you’ve been making regular payments to your credit card company, you could try negotiating a lower interest rate or look into transferring the debt to another company. Seeing all your debt in one place may sound stressful, but it’s an important first step in taking control and minimizing what you can.

Review Your Retirement Contributions

If you save for retirement through an employer-sponsored plan such as a 401(k) or 403(b), take some time to check up on your account. This is true for everyone, even those who have opted to have funds automatically deferred. This year, the 401(k) contribution limit is $19,500 for those under 50 and $26,000 for those 50 and older.3 If you’re approaching retirement, you now have the opportunity to save even more in your account in order to get the most out of your employer-sponsored plan. Checking in on your yearly contributions now gives you plenty of time to catch up or contribute more before the year ends.

Assess Your Tax Liability

Double-check your tax withholdings, make sure that you have the proper amount withheld or determine if adjustments need to be made. Adjustments may be necessary if you’ve experienced certain life events, such as retirement, marriage, and/or divorce. Making sure your tax withholdings are reflective of your current situation for 2021 can help you avoid surprises come tax season.

 

Re-Evaluate Your Goals

After over a year of living through a pandemic, you are sure to have gone through some unexpected changes in your life. Now is an opportune time to revisit the goals you made at the start of 2021 and make sure they are still well-aligned with your current standings. If not, take a step back to look at your entire financial situation and future needs, and create new goals that better reflect them.

Take some time to prepare for the last quarter of the year. As transitions continue and varying levels of normal exist, reevaluate your financial standings. Determine whether you’re on track to meet your goals, or if you may be in need of assistance from a trusted financial professional.

 

https://www.statista.com/statistics/243439/holiday-retail-sales-in-the-united-states/

https://www.statista.com/statistics/246963/christmas-spending-in-the-us-during-november/

https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-401k-and-profit-sharing-plan-contribution-limits

This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.