Financial Planning | January 3, 2018
Now that 2018 is here, it’s time to start thinking about your financial resolutions.
Financial reflection is certainly not limited to January. Still, it is a popular time when life slows down from the bustle of the holidays and the early weeks of the new year, freeing you up to plan for the year to come. Committing to the following four resolutions will help to strengthen your 2018 financial situation.
The most important step in establishing any savings goal is to ensure that it is measurable and achievable. To successfully save more, start with your budget first. The new year is an ideal time for this process, since you’ll have fresh year-end numbers as well as annual credit card statements that generally arrive by mid-January. To be conservative, base your 2018 financial projections on 2017 numbers. Rigorously review all 2017 expenses and ask yourself where you can cut back. Also, consider how your values and priorities may have changed, and how these differences impact your spending.
There was a time when many professionals carried both personal and work mobile phones; I was one of them. I used to keep a mobile phone in my briefcase so family and friends could reach me. I left it in there for almost two years. I’m pretty certain that I didn’t receive even one text. At a cost of $91 per month, I threw away almost $2,200 in a two-year period. At one time, I must have felt compelled to carry a personal phone. But, family and work-life expectations change over time. Once I realized the seepage, I easily reallocated that money to savings.
As you define or enhance your annual budget, including target savings and anticipated expenses, be sure to clearly articulate and prioritize your savings goals and related personal values.
What is more important to you, saving for retirement, education, a second home, a child’s wedding, extensive travel, etc.? Certainly, you can save for more than one thing at a time. However, without prioritizing your goals, you’ll often be left feeling as if you accomplished nothing.
Key Savings Tip
If you’re looking to save more, then start by paying off debt, including high-interest college loans and credit cards. Here is one step-by-step guide detailing ways to pay off debt while still saving.
Reviewing your budget and savings can often lead to evaluating career goals.
Many people believe they can increase their income and, therefore, save more by changing jobs. Although this may be true, you should first revisit your current salary and complete benefits package. Ask yourself if there is additional opportunity with your current employer for either a promotion, an added bonus, or both.
Also, ask yourself the following questions when contemplating a job change:
Resolution #3 – Shred & Delete Excess Financial Statements
If you’re able to switch from paper statements to digital, do it. By merely switching to digital statements, you reduce clutter in your life. Also, holding onto enormous amounts of financial statements is counterproductive, making it that much more difficult to have a clear picture of your financial situation. Other than maintaining your tax records for seven years, keep year-end financial statements, and shred or delete the rest. Limiting data points enhances your ability to measure progress.
It’s important to think about financial components in your life that you may not consider on a day-to-day basis. Here are five:
If you don’t have full awareness of your financial situation, coupled with well-defined, measurable goals, then it’s unlikely you’ll meet your financial objectives. At GW & Wade, we encourage our clients to clearly define their goals. Our role is to reinforce these goals by building a financial plan that brings together all elements of an individual’s financial life, including estate, retirement and tax planning, as well as a plan that reflects an individual’s values. Everything needs to be looped together in order to create a strong and tax-efficient financial life.
If you have questions regarding your financial situation, please contact us. We welcome the opportunity to help you achieve your personal and financial aspirations.
The information provided above is general in nature and is not intended to represent specific tax, investment or professional advice. No client or prospective client should assume that the above information serves as the receipt of, or a substitute for, personalized individual advice from GW & Wade, LLC, which can only be provided through a formal advisory relationship.
Clients of the firm who have specific questions should contact their GW & Wade Counselor. All other inquiries, including any inquiry concerning a potential advisory relationship with GW & Wade, should be directed to:
Laurie Wexler Gerber, Client Development
GW & Wade, LLC
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