Along with your new years’ resolutions, you may have included several financial goals for yourself. The beginning of a new year is the perfect time to prepare your finances for the rest of the year. With 2022 bringing a severe surge in inflation, it is even more important to be conscious of your financial decisions. Continue reading for three money tips for 2023.
1. Track Your Spending
Whether your goal is to save more, decrease your debt, or invest more, tracking your spending is a great way to understand how your money flows in and out every month. Monitoring cash flows is an important part of a successful financial plan. By not tracking expenditures, you leave yourself susceptible to overspending in different areas.
Keep an eye out for excessive spending on non-necessities. Reconsider any unnecessary purchases such as subscription services that you rarely use and look for ways that you can cut back on certain areas, such as cooking at home more instead of eating out.
Many banking apps have spending trackers that identify your main spending categories. This is an easy and convenient way to see how much you are spending each month compared to how much you are bringing in.
2. Maximize Your Retirement Savings
Time is key when it comes to retirement savings. If you have put off prioritizing retirement savings, now is the time to focus on it. The more time your contributions are allowed to compound interest, the larger nest egg you will have when you are ready to retire.
For 401(k) plans, you can contribute up to $22,500 in 2023 with a $6,500 catch-up contribution if you are 50 years old or older.
For Individual Retirement Accounts (IRAs), the contribution limit for 2023 is $6,500 with a $1,000 catch-up contribution if you are age 50 or older.
Reducing excessive spending may help you identify areas where you can contribute more to your retirement savings accounts throughout the year. Retirement plan contributions also provide several tax benefits.
3. Diversify Your Investments
As we enter 2023, it is important to invest with caution and with long-term goals in mind. A diversified investment portfolio helps to mitigate risk and maximize returns. Aim to spread your investments across different asset classes, such as stocks, bonds, real estate, etc. Consider mutual funds or exchange-traded funds that offer a combination of different investment opportunities in one.
Now is a great time to take control of your finances. To keep you on track with your financial goals throughout the year, have a knowledgeable financial advisor on your side. Our financial advisors at Curo Private Wealth can help you reach your goals and succeed. Schedule your consultation with us today.