There are 33 days left in 2018! That’s plenty of time to take action on some of those 2018 financial New Year’s resolutions that have been collecting dust since January. Read on for a few concrete steps you can take over the next month to fulfill your 2018 resolutions and get on track for 2019.
Build Your Emergency Fund
An emergency fund can help you weather the financial challenges that pop up unexpectedly. Think of it as a “peace of mind” fund. The general rule of thumb is to keep an amount equal to six months of basic living expenses in a savings account or other liquid account. It’s a big number, but don’t let that deter you. Start by setting up regular, automatic payments from your paycheck or checking account into your emergency fund account. And let it grow.
Increase Your Retirement Savings
In 2018, you can contribute up to $18,500 to a 401(k), 403(b) or similar workplace retirement plan. If you’re 50 or older, you can add an extra $6,000 in “catch up” contributions in 2018 for a maximum total annual contribution of $24,500.
Talk to your HR department today about increasing your contributions to your retirement plan. “Maxing out” is ideal, but even smaller contribution increases of 1-2 percent can have a big effect on your retirement savings over time. And if you haven’t begun contributing to your company plan, enroll today. Be sure to contribute enough now to take advantage of any match offered by your employer.
If you’re already maxed out (great!), consider opening or contributing additional funds to an IRA (individual retirement account).
Make Charitable Donations
This is the season of generosity and giving. It’s a great time to make donations to organizations and charities that do good work and that are meaningful to you. In addition to contributing to a good cause, you may be able to deduct your charitable giving from your 2018 taxes.
Learn about Investing
Investing is an essential element in growing your money for lifelong financial security. So, if you don’t already know the process of investing, 2018 is a great time to start learning.
Many of us are already investors through 401(k)s, IRAs and similar plans. But do you know your risk tolerance or the difference between stocks and bonds and how they work in your portfolio? Do you have concrete, exciting financial goals? You should. When you learn about the process of investing, you learn about goal setting, the various types of investment vehicles and how they work with each other and for you, risk tolerance, the role of advisers, how to protect your assets and much more.
The Investor Protection Institute has a lot of great objective, non-commercial resources to help you learn about investing. Check out the IPI and When I’m 65 websites for booklets, videos, research, blogs and more at: www.iInvest.org and www.wi65.org.
And check out your public library for resources on a variety of financial and investing topics.
Beat the Rush and Start Now on Your 2019 Resolutions
If you’ve started any (or all) of the steps above, congratulations! Investing isn’t rocket science, but it is challenging, and it does require action and effort. So pat yourself on the back for everything you are doing to reach your financial goals. If you’re on a roll and want to keep going, here are a few more ideas:
- Check out your full credit report.
- Check your account beneficiaries. Life happens, and we don’t always remember to change account beneficiaries after significant life changes like marriage.
- Track your expenses for three months. You will be amazed where your money goes.
- Set up a dedicated holiday account for next year. Enjoy a debt free 2019 holiday season.
- Share what you’ve learned about saving and investing with your kids and parents.
33 days and counting. Dust off those 2018 resolutions and get started!