12/27/2024
As the year comes to a close, here are a few financial house keeping tips to consider to start 2025 off in the right direction.
1.) Retirement - if you didn't max out your retirement plan in 2024, do some preparations for 2025 now so you can update the amount you have coming out of your payroll. The max for a 401k in 2025 will be $23,500 if you're under 50 years old. If you're between 50-59 years old, you can contribute an additional $7,500 for your catch up contributions. There's also a new kicker starting next year too. If you're 60, 61, 62, or 63, you can contribute an additional $11,250 instead of just the $7,500.
2.) Health Savings Account - if you have a health savings account in 2024 and you have some extra money to invest, remember you can put up to $4,150 for your self and $8,300 if you have a family plan. If your Health Savings Account allows it, you can actually invest the money in the plan instead of it setting there doing nothing. Remember Health Savings Accounts are the only triple tax advantaged plans. If you didn't have one in 2024, now is a good time to be checking on if you are eligible to open one for 2025. The limits for 2025 will go to $4,300 for individuals and $8,550 for families.
3.) Review your budget - see if you've been able to stay on track this year. If you've overspent in some areas, make some adjustments in your numbers and get ready for 2025. It's also a good time to see if you can cut some expenses in certain areas. If you separate your discretionary spending from your necessary expenses, you can easily find items you may be able to trim from next years budget.
4.) Review your insurance policies - most people think when they review their insurance policies they need to find cheaper insurance. That's not what I'm referencing. You need to make sure you are properly covered. Call your insurance agent and go over your policies to make sure you have the right coverages. People have become too focused on saving money on their insurance instead of focusing on the purpose of insurance. It's to protect you, your family, and your assets. In the event of a claim, if you don't have the right coverages, you may put yourself in more financial hardship by trying to save those few dollars.
5.) Set some goals for 2025 to put yourself in a better financial position. Whether its to pay down higher interest debt, save more in your retirement plan, or maybe you need to get that emergency fund up a little bit. Make sure you have a plan and start in January to be in a financially stronger position than you are at the end of this year. Maybe you have never made a budget before. Start 2025 off with having a budget in place and stick to it the best you can. If you need some help with setting some goals and getting your finances on the right track, here's a link to a book that may be able to help you.
https://a.co/d/09Ps65r
