Your Route to Financial Wellness in 2022

It is no accident that January has been named Financial Wellness month – it’s the month when most Americans take stock of their lives and set goals for the coming year.  Each year financial wellness is high on that list.

It is no accident that January has been named Financial Wellness month – it’s the month when most Americans take stock of their lives and set goals for the coming year.  Each year financial wellness is high on that list.

This year is no exception – according to the recent Fidelity Financial Resolutions study Two-thirds of Americans have a financial resolution on their list and almost three-quarters feel optimistic that they’ll be financially better off in 2022.

 

Save more money

This one tops the list.  Almost half of the respondents (43%) said saving more money was their number one goal for 2022. To save more in the New Year, you need a plan to save money every month. A good rule of thumb to follow is to save 15% of your salary each month. Don’t just leave it in the bank. Put your savings to work for you. Find high yield interest savings account so it earns interest.

Once you’ve built an emergency fund that you’re comfortable with, start investing your savings. Investing in your future is good for you and your family. Seek professional help from a financial advisor if you’re unsure which investments would be right for you.

“Speak to a financial advisor who believes in the sensible middle ground of investing,” says Lawrence Merl, Senior Vice President at David Lerner Associates.

Pay down debt

41% of survey respondents listed paying down debt in 2022 as a high priority. If you have a lot of installment loans and credit cards, you may want to consider getting a consolidation loan. This type of loan combines all your payments, so you just make one per month and save money on interest fees.

It’s vital to understand the fees and interest rates on loans and credit cards. Make your payments on time to avoid extra fees. See if you can negotiate a lower interest rate with your credit card companies or switch to another credit card.

 

Spend less

Setting up a simple budget is the first step. Then track how you’re spending every cent, at least for the first couple of months. Everyone is surprised by how their money is being spent when they take the time to really examine the issue.

Decide if a purchase is ‘need’ and a ‘want.’ It’s not always easy to deprive ourselves of the things we desire, but many financial challenges are created by poor impulse control. This includes purchasing things you can’t afford and things you don’t really need. If you can say ‘no’ when it’s appropriate, you’ll eventually be able to purchase the things you really want.

 

Keep an eye on your credit score. Credit scores become more important every year. It’s common for credit reports to have errors, so be sure to review your credit report every year. Take the time to learn about credit and how to build a strong credit profile.

 

These simple financial strategies can put you on the road to financial wellness in 2022.

 

 

 

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.