If you made New Year’s resolutions, there’s a good chance one of them has to do with finances or organization. This article addresses valuable financial tips that will help you get better control of your finances by implementing organization into your budget. Consider it a two-for-one.
Assess and Refine Your Budget
This may not seem like new advice, but even if you already have a working budget, it’s worthwhile to look at it with fresh eyes as the year begins. Ask yourself the following questions:
Does my budget support my financial goals?
Take time to write down your financial goals and then build monthly allocations into your budget. While vacations and significant purchases may be on your list, make sure you also establish goals for an emergency fund and retirement.
Are my tax needs factored into my budget?
Nobody likes getting a tax bill at the end of the year, but a large refund isn’t necessarily a better alternative. It may feel nice to get a sudden influx of money, but that is money you could be earning interest on as you set it aside to reach your goals faster. Try to find a balance between the two and minimize your refund.
Is my budget written down?
You can do this with apps, spreadsheets, or pen and paper. It doesn’t have to be sophisticated. Just make sure to designate a category for every dollar earned and spent. Don't forget to include infrequent expenses such as oil changes, property taxes, and even Christmas gifts.
Do I live by my budget?
A budget should be firm enough to keep you on track toward your goals but flexible enough to allow for unexpected expenses. If you get off track, it’s important to get back to the budget right away. Getting off track is a learning opportunity. Use it to assess your budget and see where you might be able to cut back in order to save money for any future unforeseen events.
This year, don’t just save more, save smart. The point of saving money is to reach financial goals faster. One very easy way to save smart is to put your money where you'll earn a higher interest rate than what you'll typically find with a standard savings account at a bank or credit union.
Contrary to what many think, you don’t have to have a lot of money to start. For example, AGLF Demand Investment Certificates* can be opened with a minimum investment of $250.
Plan for Retirement
Open a Retirement Account.
If you have access to an employer account, such as a 401(k) or 403(b), set one up. If you’re an AG minister or AG ministry employee click here to learn more about our fellowship’s official 403(b) plan. Alternatively, you can contribute to an Individual Retirement Account (IRA). There are several different types of IRAs including Traditional, Roth, and Simplified Employee Pension (SEP), which is a great option for the self-employed. Learn more about the differences here.
Read More: The Millionaire Retirement Standard
Make regular contributions.
Get an idea of how much you’ll need to save with these easy retirement calculators. Make budget allocations accordingly. The most painless way to save for retirement is to have contributions automatically deducted from your income. You may be pleasantly surprised and find that you don't even miss that money.
Increase your contributions over time.
It’s absolutely okay to start small, but make it your goal to increase the amount little by little. If your employer offers matching contributions, try to build up your amount until you’re taking full advantage of this benefit.
These resolutions will help you build a stable financial future. If you’d like more information about investments and retirement planning, we’re here to help. Call 866.621.1787 to speak with a consultant.
*This is not an offering to sell securities referred to herein and we are not soliciting you to purchase these securities. The offering is made only by the Offering Circular which includes risk factors. The Offering Circular may be obtained by writing or calling AGFinancial or by clicking here. An investment in AGFinancial involves certain risks that other investment options may not have. Not all risks can be quantified or compared to other investments. You should carefully evaluate all the risks in assessing the potential benefit of the various investments. AGFinancial investments are offered and sold only in states where authorized or exempt from authorization. Not available to new investors in Washington. Not available in Ohio. AGFinancial is an affiliated entity of AGFinancial.
Not FDIC or SIPC Insured. Not a Bank Deposit. No AGFinancial Guarantee.