This year has been a doozy for the stock market. Lots of ups and downs with the market, once again, flirting near bear market territory (down 20%+). While you can’t control the market gyrations, here are some financial tips for things you can control.
#1 Set up a budget – We know ~ this is the most boring tip! But MANY clients come to us with no idea how much they spend or where their money goes! It’s hard to plan for the future if you don’t have a handle on the present. Let 2023 be the year you finally get a handle on your expenses. Some helpful tools to get you there:
YNAB – You Need A Budget
Mint – Mint.com
#2 Figure out your emergency fund – You’ll need to tackle step #1 as this step is based on your monthly expenses. The old rule still applies – it’s good to have at least 3 months of expenses in savings. If you are single or your job is not guaranteed stable, you may even need 6 months. Here are some places you can stash your cash to earn some money on your money:
Discover Online Savings – Discover Bank
Marcus by Goldman Sachs – Marcus by Goldman Sachs®
SoFi Bank – SoFi
#3 Pay off consumer debt – If you are carrying a balance or have a variable rate (which is on the rise!), make a plan to get your debt paid off. If you don’t have cash on hand to pay it all off, you can consolidate your debt onto a low interest rate credit card or HELOC and focus on getting your debt paid off in 2023. This credit card is offering 0% APR on balance transfers AND purchases into 2024!
Discover it® Cash Back – Discover it® Cash Back
#4 Review your credit report – Most credit cards now offer free credit report ratings and you get one free credit report from the major agencies annually. Make sure everything looks ok and if not, address the issues to boost your score.
Annual Credit Report – (the Federally authorized site) Annual Credit Report.com
#5 Pay yourself first – Who doesn’t like to get paid? By setting up automatic transfers into your IRA or Roth IRA, savings account (see #2 above) or brokerage account, you make sure you are paying yourself first and building savings for your future. Also make sure your employer retirement plan contributions are set to the new maximums for 2023 ($22,500 under 50 and $30k over 50).