Personal Finance Tips for Financial Planning

No matter what your financial situation is, whether you're playing catch up on retirement savings, working to eliminate debt. or building wealth, it pays to be financially savvy. A recent poll found only about 1/3 of Americans (32%) maintain a household budget. Only 30% of Americans have a long-term financial plan that includes savings and investment goals. It was also found that you’re most likely to budget if you make at least $75,000 per year. 

A 2017 report in MarketWatch found that half of American households currently live paycheck to paycheck. And with regard to savings, 19% have $0 saved to cover an emergency expense, and 31% have less than $500 in emergency savings. Not surprisingly, about 49% of Americans are “concerned, anxious, or fearful about their current financial well-being.” 

Here are some tips to point you in the direction of smart personal finance decisions:

Big picture

Online financial tools like Mint.com allow you to see your bank accounts, investments, credit cards, loans, and credit scores in one place in real time. And you have the ability to access that information anywhere, whether you’re on your work computer, smartphone, or home PC.

The tool also allows you to create a custom budget, print reports, or export data into Excel or Quicken, which allows for easy collaboration with your tax preparer.

Find out what you are doing right

A lot of times we will try to fix what was wrong and don’t take time to reinforce the good habits and things that we were doing right. For example, if you are contributing to your savings regularly, recognize that this is a great habit to have, and continue supporting it. And if you can automate those activities, all the better, whether 401(k) payroll deduction or direct deposit from a bank account.

Savings

If you aren’t saving regularly, it’s never too late. Open a 401k or IRA and start saving now! Start an emergency fund. Think ahead, and plan for a rainy day now before the clouds get dark and you need an umbrella.

Checks and balances

For obvious reasons, it’s a good financial habit to monitor your bank and credit card account activity on a regular basis. And fortunately, most financial institutions offer online alerts that do a lot of that monitoring for you. You can even set the dollar amounts for balances or purchases with some banks.

Additionally, for credit cards, you can set payment reminders. That way you won’t get hit with a late fee (which could be as much as $39 each time, according to CreditCards.com). 

Credit cards

Transferring credit card balances on high-interest rate cards to one with a lower rate may help you consolidate your monthly payments and save on interest. Once you’ve done that, if you’re worried about using the cards again, shred them rather than canceling them. You’ll still have the credit line in your name, but you won’t have the temptation in your wallet.

 

IMPORTANT DISCLOSURES

Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities.

To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law.

Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.

These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable– we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

David Lerner Associates does not provide tax or legal advice. The information presented here is not specific to any individual's personal circumstances. Member FINRA & SIPC