13 Ways to Improve Your Finances in the Year 2013 – Part 2
On our last entry, we took a look at the first three out to thirteen different tips tat can help you turn 2013 into your most successful financial year ever. Now, we take a look at a few more while we keep discussing how using these tips you can even avoid applying for a personal loan in the long run.
Ready? Let’s resume.
4. Don’t Rush Paying Off Your Debts
If you happen to have acquired a quite substantial amount of debt, like personal loans, credit cards and such, it becomes almost impossible to pay all of it off overnight. You can try of course, but you risk not only end up frustrated, but also bankrupt. So if your debt is quite substantial, don’t panic and fall into the mistake of wanting to repay it as soon as possible. Instead, slowly and make a payment plan that includes all credit cards and personal loans’ debts.
The best way to implement a payment plan is to first change your spending habits and then to set up individual savings accounts for each one of the debts you want to repay as well as for your real savings. This will motivate you to keep building on you savings in an organized way instead of losing focus for wanting to take care of everything. Once you start regaining some control, then you can slowly start to repay your debts.
5. Be Ready for Those Dreaded Tax Changes
As is expected with every new government and with any country that is undergoing an economic recovery (the U.S. is actually experiencing both of these right now), tax rates and laws are very likely to change, and not for the better. This means that most taxes will tend to rise for almost every single American except the poorest, and mostly for the highest-earning ones. So in order to lessen the stress caused by those tax increases to come, what you can start doing here and now is to adjust your expenses and to start creating saving habits that will allow you to save as much as possible during the coming months. If you do this well you will barely feel the hit when the time to pay your taxes comes.
Needless to say, in order to save even further when tax-paying time comes, make sure to take advantage of any credits and personal loan deductions. Additionally, you can also put some savings into a tax-advantaged retirement account, so your funds there remain unaffected by any tax increases.
6. Estimate Your “Magic” Retirement Number
Perhaps one of the most sadly overlooked aspects of retirement among people from the U.S is that they fail to do the exact math in order to figure the amount they will need to save for retirement. Of course, just about everyone takes for granted the famous 401K number, but this is only a simple approach and not set in stone by any means.
So if you have neglected calculating it, make sure to do so. This is an essential step that should be done as early on as possible if you want to be sure you are not drowning in debt and personal loans when the time to enjoy your retirement comes. The general advice in this regard of your financial life is that in order to enjoy those much-deserved golden years when they come, you should have saved enough to at least replace 80 percent of your regular income. That would mean to have enough savings on your account to keep leading the lifestyle you are even years after retirement. Of course, in order for this to work, you should plan and start saving as early as possible in your life.
There you go. Make sure to stay tuned for our next entry where we will keep giving you some great tips for making 2013 your best financial year so far.