Letter of the Month: 17 Financial Resolutions for 2017
As the end of 2016 approaches, now is the time to start thinking about how you’ll make 2017 fulfilling and fruitful for you and your loved ones. For more than 4,000 years, many people have celebrated the start of their new year by making promises to change their behavior or improve themselves. And it’s no wonder why: While New Year’s resolutions can be hard to keep, they may also make you more than 10 times more likely to achieve your goals than if you hadn’t made a resolution at all.
So, no matter what you hope to accomplish next year and beyond, here are 17 financial resolutions to help make 2017 healthy, happy, and successful:
Create emergency savings
Life is full of unexpected emergencies, and having extra cash on hand can help keep a serious illness, home repair, or other sudden financial need from derailing your finances. Prepare for unpredictable expenses by putting aside six to eight months of expenses in an easily accessible cash-equivalent account.
Make a monthly budget and stick to it
Budgets may sound like a lot of unnecessary work, especially if you’re financially comfortable. But if you’re not tracking your spending, you may be surprised by how quickly it adds up — and which expenses are costing you the most. As 2017 begins, set a budget and work on sticking to it for three months. Track your performance and revise the budget, as needed. Don’t aim for perfection; instead, try for incremental improvement.
Save more for the future
Creating a disciplined savings strategy is an important way to stay on track for your retirement and other goals. We recommend keeping separate “buckets” of savings for short-, medium-, and long-term goals, and leveraging tax-advantaged accounts where possible. Let us know if you’d like help saving for specific goals so that we can help ensure you have the right strategy for your needs and timeline.
Make retirement plan contributions regularly (instead of all at once)
Even if you’re diligently saving, you may be among the 71% of Americans who haven’t put aside enough money for retirement. One key change you can make is to take advantage of time in the market. Instead of waiting until the last minute to make your annual contributions, give your money more time to grow by making automatic contributions to your accounts every month.
Maximize your retirement-plan contributions
Tax-managed retirement accounts are one of the most powerful ways to save for a more comfortable retirement, because they allow you to control your tax liabilities today — while accumulating assets for the future. Make the most of these accounts by contributing as much as you can each tax year. We usually recommend maxing out employer-sponsored plans first to take advantage of any matching contributions your employer may offer. Give us a call if you need help understanding your retirement account options.
Pay down high-interest debt
Did you know that 54% of Americans believe they will never pay off their debts? Don’t let high-interest debt keep you from getting ahead financially. If you’re carrying a significant amount of debt, make paying it down a top priority this year. Contact us, and we’ll help you create a strategy for managing your expenses and paying off your debt.
Set goals for the future and work with a professional to help you achieve them
From our experience, people who set goals for themselves and create strategies to pursue them are much more likely to see success. We’re here to help you and your family define exactly what you hope to accomplish in 2017 and beyond — and then build a strategy to achieve your objectives.
Create a powerful legacy for the world
We believe that a rich life involves more than financial success and a comfortable lifestyle. Whether you want to leave something to your loved ones or support causes you care about, take time to address the legacy you’d like to leave.
Review your estate planning and legal documents
Your core legal documents need regular reviews to ensure they keep up with any changes in your life. If a few years have passed since you looked at your documents, dust them off and make sure that they still represent your wishes. And if you seek more guidance on your estate plan, will, or other legal needs, we can connect you to thorough resources and helpful advice
Review the beneficiaries of your financial accounts and insurance policies
As life changes, you need to periodically review and update your account beneficiaries. Since beneficiary provisions are independent of your will or other estate provisions, keeping them current is critical. Contact us for assistance with gathering account documents and making any needed updates
Stay on top of your health
Healthcare is a major expense for most Americans, especially if serious illness strikes. Take steps to protect your wellbeing by building a healthy lifestyle and prioritizing preventive care.
Protect your credit and identity
Identity theft and financial fraud are serious threats that can compromise your financial wellbeing. Protect yourself by reviewing financial statements and bills carefully for unauthorized activity. Regularly update your passwords for all financial accounts and always shred any sensitive documents before you dispose of them. Check your credit report for free each year at www.annualcreditreport.com.
Review your tax strategies for potential savings
Every dollar you save in taxes is one that you can reinvest in your current lifestyle or future goals. But, recent tax-law updates mean that your tax burden may have changed — or even increased. Give us a call to discuss tax strategies that may help you reduce your tax liabilities.
Involve your children and grandchildren in your finances
Fostering financial wisdom is a powerful way to help your children and grandchildren build a solid, stable life — and help ensure you’re able to pass on your values and wealth in the future. Rather than keeping your finances private from your loved ones, we recommend including them in conversations about your goals and priorities. We also invite you to bring them to our next meeting. We’ll help them understand how we work together and what their roles and responsibilities may be in the future.
Schedule times to discuss finances with your spouse
If you (or your spouse) rarely get involved in the family finances, now is the time to start. Work together to make financial decisions and make sure that each of you understands the overall game plan for your finances. At minimum, make sure that your spouse knows how to access financial accounts and understands your wishes.
Identify your goals for 2017
Determine exactly what you hope to accomplish in 2017. Whether you want to earn more money, go on a wonderful vacation, or spend more time with your family, take a moment now to write down your goals. To increase the odds of achieving these goals, consider sharing them with a friend and providing regular updates on your progress.
Keep your financial resolutions
Just 8% of people keep their New Year’s resolutions — but by making your goals simple, specific, and actionable, you can increase your chances of being among this select group. Instead of saying: “I will save more for the future in 2017,” say: “I will contribute $4,500 to my retirement accounts by December 31, 2017,” or “I will pay off $2,000 of credit card debt by April 15.”
As 2016 draws to a close, we would like to once again thank you for the trust and confidence you’ve placed in our firm. We are sincerely grateful for the privilege and opportunity to serve you today and for years to come.
If you have questions about your future or would like some support in keeping your financial resolutions, we are here to help. Please call us any time. Together, let’s make 2017 a success.
Footnotes, disclosures, and sources:
All information herein has been prepared solely for informational purposes and is not an offer to buy or sell, is not a solicitation of an offer to buy or sell, any security or instrument, nor is it an offer to participate in any particular trading strategy. All content on this site copyright 2015 Capital Management Services. No content may be copied, reprinted or distributed without permission.
Capital Management Services is a Registered Investment Advisor. Investment Advisor Representatives of Capital Management Services may transact Advisory business in a particular state only if first registered with that state, or if specifically exempted from that state’s Advisor requirements. In addition, follow-up conversations or meetings with individuals in a particular state that involve either the effecting (or attempt to effect) transactions in the rendering of personalized investment advice for compensation, will not be made absent compliance with state Advisor registration requirements, or an applicable exemption.
As with any investment, please bear in mind that past performance is not a guarantee of future performance. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment or investment strategy referenced by CMS, Inc., will perform in accordance with historical levels.
Information contained in this article does not constitute the receipt of personalized investment advice from CMS, Inc., any related entities, or from any other investment professional. To the extent that a visitor to this site has questions regarding the applicability of any of its contents to his or her individual situation, he or she is encouraged to consult with a Registered Investment Advisor Representative of CMS.
These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative, Broker dealer or Investment Advisor, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer or Investment Advisor gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.