Personal Finance

Here’s what you can do now to set yourself up for financial success in 2022

Jordan Siemens | DigitalVision | Getty Images

Change your mindset

Fear of the unknown holds many people back from taking the first step towards financial wellness, Henske said.

Whether it is setting up a child’s 529 savings plan, getting insurance or drafting your will — just get started, he said.

“If you want to procrastinate, procrastinate when the meeting is going to be,” Henske advised. “Don’t procrastinate scheduling the meeting.”

Max out your retirement plans

The annual contribution limit for employee-sponsored retirement plans, such as a 401(k), is $19,500 this year, or $26,000 if you are age 50 or over.

If you can, try to max out your contributions. If you can’t, at least try to contribute enough to get the full company match.

“That’s free money,” Sun said. “Don’t leave it on the table.”

Then, if you have already maxed out your 401(k) or don’t have one, do the same with your individual retirement account or Roth IRA. The maximum contribution this year is $6,000, or $7,000 if you are age 50 or older.

Even though you have until April 15 to max your retirement savings account out for 2021, doing it now will enable you to start saving for 2022 in January, Sun pointed out.

Look at your budget

Review your investments

Jose Luis Pelaez Inc | DigitalVision | Getty Images

While you should always periodically review your portfolio, now is a good time to check and make sure your assets are balanced. So, if you have gone above your 10% allotment in large-cap growth stocks, for example, make adjustments so it goes back to 10%.

If you sold any assets and made a profit, consider selling an asset that isn’t doing so well. It’s called tax-loss harvesting. By selling assets at a loss, it will make up for some of the gains you made and should reduce the amount of taxes you will have to pay.

You can also gift assets that have gone up to someone in a lower tax bracket to avoid tax hit, Sun suggested.

Check your medical expenses

If you still have money left in your flexible spending account, you may want to make that doctor’s appointment you’ve been putting off or buy qualified items so that you get the reimbursement for this year.

While legislation signed into law late last year allows you to roll over any unused FSA funds into 2022, your company has to opt in. Some employers also give a grace period of a few months into the next year or permit you to carry over $550. If you still have money in the account, check with your employer to make sure you don’t lose it.

Go on autopilot

While people have the best of intentions to get their financial life on track at the beginning of the year, things begin to fall apart as the year goes on. By setting up automatic transfers from your checking to your savings or investment account, you can avoid that, Henske suggests.

For more updates check below links and stay updated with News AKMI.
Life and Style || Lifetime Fitness || Automotive News || Tech News || Giant Bikes || Cool Cars || Food and Drinks

Source

Related News  The next relief bill could include stimulus checks, work bonuses
Tags
Show More

Related Articles

Back to top button

usa news wall today prime news newso time news post wall

Close