-Did you bring on any new debt from the holiday season in the New Year? There was a USA Today snapshot published in its paper on January 31st that said: "On average, it will take consumers about
10 months
to pay off their holiday credit card debt." (This statistic was based on 1,000 consumers who went into credit card debt because of holiday spending).
Where you one of those consumers? Did you forget to follow the guidelines from our October article?
Did you set yourself back from building the emergency fund or Rainy-day fund you had intentions to build?
You will need to be concerned if you did because you now will have to adjust your intentions and spending going forward into the year. If you made a New Year's Resolution, you may be among the 90% of New Year Resolutions that are usually broken by the end of March each year. People, especially women want to do right for themselves, but life gets in the way. They may end up helping their children or another family member when they least expected it. They think they can catch up at another time, so they put off starting the first level of money management which is the Rainy-day fund. But, I find the New Year brings on new challenges, and now we must deal with them, so back on the burner goes the Rainy-day fund.
Remember back in September when we talked about our Needs and Wants? It was when I was referencing the response from a member of the audience on her story about her daughters.
I guess I am trying to tell you that if you are not on track to improve your Financial Life, you need to start. Don't let unexpected items derail your good intentions to get on some solid financial footing starting this year!
We are now done with this year's tax season, April 17th was the deadline to do something beneficial for yourself. Did you open a ROTH IRA or a Traditional IRA for yourself? Depending on your intentions, you could have benefited from either.
The ROTH IRA would have started you saving for your retirement with tax-free growth for the future. You would not have had a deduction with your current tax liability, but for the future you would not have had to worry about taking money out of the ROTH that would have increased your tax liability then.
If you were wanting something to reduce your tax liability now, then a Traditional IRA would have been what you were looking for to do that job. A traditional IRA would have given you an immediate tax deduction on your tax return. Not a dollar for dollar deduction, but a deduction in your tax liability NOW!
Depending on what works for you, you would have benefited from acting. You can't let procrastination keep you from reaching your long term financial goals. If you need to do something this year to have more control over your finances, build that Rainy-day fund first! Everyone has a "Comfort Zone", aim toward that zone and do your best to stay on track.
The financial industry says an "emergency fund or Rainy-day fund" should be 3 to 6 months of your living expenses. Here is where the budgeting tools we talked about last October, November and December should help you determine what that amount should be. If you cannot do this calculation on your own, I am here to help. I can send you out a Budget packet to add up your figures, and we can get to your base-line on expenses together, or you can call me to set up an appointment. We are now also having a Women's Gathering every third Saturday morning each month. The next gathering is April 21st. You can come and learn from each other and talk about what is working for you among your peers. It's an open forum for all women to participate in and I'd love to see you come and join us.
