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Plan to succeed: Your finance-centric new year’s calendar to buck the resolution back-slide

As the calendar turns to a new year, your friends at O’Donnell, Ficenec, Wills & Ferdig are presenting you with the gift of planning and our own, all-important, financial-centric calendar. Here, we take a month-by-month look at milestones to consider and reach. We have divided it into more manageable “chunks,” and as quarters. Happy goal-smashing! 


A note on the “science” of success 


It is seemingly as foregone a conclusion as taxes; a resolution made is a resolution that likely won’t stick. However, leading researchers in the art of motivation, which lends itself well to successful resolutions, have demystified what sets good habits apart from a goal that never had a chance to become a fruitful habit. These findings align well with the organizational timeline that we have provided below:


  • Having specific targets in mind at various stages or steps in one’s plan serve to pull you toward the favorable “end” or goal. After all, if you had a specific dollar figure in mind for savings in a given year and you come up short (if only by a nominal amount), you will still likely be very disappointed by it. The fear of disappointment can function as a strong motivator. 

  • The regular assessments that represent the below calendar and plan help to solve the challenging “middle problem,” as the researchers refer to it. By recalibrating and seeing each month, quarter or period as a fresh start, you also get through the “slog” – the tendency to cut corners in the middle of the year, say, when efforts to improve or enhance your financial situation are no longer novel or exciting, the light at the end of the tunnel has dimmed, and the day-to-day grind may overwhelm you and your well-meaning plans. 

  • The calendar below suggests and demands regular monitoring of progress. Following through with these routine assessments helps to reaffirm one’s commitment. There is nothing quite like the “lift” that comes with seeing what you have accomplishes thus far from previous months, and the progress that reinforces you are on the right track.


FIRST QUARTER 


January presents a great time to conduct a review of your investments. Consider if any adjustments need to made in terms of how much of your salary is allocated toward your nest egg. This step requires comprehensively assessing any “damage” from the year prior. You may need to take a hard look at if too much of your monies are being funneled toward investment vehicles that are not right for your current situation or risk tolerance; for instance, if more time (and tax-advantaged options like 401 (k)s) are on your side, the market’s returns may far outweigh any concerns over potential risks. More “seasoned” investors may need to approach any adjustments conservatively, opting for the likes of paying down mortgages, which provide surefire returns. Speaking of retirement savings, the start of the year is also a good time to see if your budget can tolerate pushing the contributions to 401 (k)s and IRAs closer toward the maximums that are allowed, based on age. 


February is not too early to begin to gather the documents that you need for tax season ‘24. Feel free to touch base with our friendly team as well. January can present difficulties on this front, as individuals are just wrapping the holiday season, and waiting until March does not provide the time horizon to ensure the filing process goes off smoothly and to address any issues that may present themselves. It is also good to get into the habit of really taking note of data or important intelligence that may be garnered from some of the documents before you send them our way, or add them to your return. W-2 and 1099 forms can say a great deal about both our inputs and outputs, and may suggest that one’s contributions to savings is not keeping pace with salary spikes, and vice versa.


As we eke ever closer to tax filing deadlines, March presents a “no sweat” time on this front, because you started the process last month. So, this means you can explore other areas for tax savings. Notably, put your finger on the pulse of your Health Savings Account. HSAs provide triple-tax benefits, and you may be missing out on ways to bolster your retirement savings health by not properly funding your account and taking advantage of the favorable tax stipulations associated with them. Also, 22-year high interest rates and inflation are only steadily sliding southward. They still remain a concern for most households. So, in this lead-up to “tax time,” step back and reassess how pricing on goods is affecting your spending, and how “bulletproof” your respective purchasing power is against these threats. 


SECOND QUARTER


You and your friends at OFWF are not scrambling to meet deadlines. With your active planning and foresight, April is not so taxing after all. Instead, you can focus on getting into good habits that will benefit future tax seasons and, ultimately, your overall financial burden and state. Work on refining how documents are organized as, inevitably, with strong partners on your side there will always be some questions or some data or document that is requested and needs to be retrieved. Having a fresh, less burdensome and efficient “system” will make things so much easier over the longer run and free up your time to enjoy your retirement or all those grand plans that you have as you approach retirement. Speaking of planning, it’s advised to create a clearinghouse for important household documents. Ensure that it is secured safely online and/or offline as appropriate. If you already have an easy go-to hub for essential documentation, listing accounts and associated numbers and providers, be sure that the information is kept up-to-date and is complete. 


With graduation season almost upon us, May presents a good time to make the grade as it relates to “rainy day” funds. There is a reason “why” it is generally suggested to have enough funds set aside to cover at least three to six months-worth of expenses. Too many people have learned the hard way what happens to their hard-earned savings when unpleasant surprises and changes inevitably crop up. And, with job cuts recently increasing, it may be high time to ensure you have enough socked away – especially if you are your family’s primary earner. It is also important for retirees to asses their liquidity to ensure they can seamlessly ride out potentially volatile circumstances. 


You may be physically on holiday, but don’t let your financial goals go on hiatus in June. There is something to be said for accountability, and the power of merely articulating and revisiting your overall goals. It is generally suggested that each investor craft or consider investment and retirement principles/goals statements. It is helpful to take a look at the content within – anticipated “deadline” for goals, characteristics of attractive investments, spending strategies in retirement, allocation of funds for income needs, and so on – at around this time, mid-year, annually. Be aware of deadlines for paying estimated taxes if you on a quarterly payment “plan,” and this consideration rings true for the end of the other quarters listed here, too. 


THIRD QUARTER


Don’t blow up your financial plans in July; create some forward-momentum fireworks! Peek in on your portfolio. This point in the year, there is still time to “course-correct” for any unforeseen developments that may have adversely affected your returns. While taking a look at your portfolio, and the likes of allocations, savings/spending rate, also use the valuable intelligence within to assess how “tax-efficient” your nest egg is – here again, are you taking full advantage of the tax benefits prevented by the likes of IRAs and HSAs? 


The dog days of summer are fully underway, but you are not letting your estate plan wither on the vine in August. As needed, solicit the expertise of a member of your financial “cabinet,” especially if you are in the initial stages of crafting an estate plan. There are likely many specific queries and situations that require guidance from pros, and not a rote, one-size-fits-all planning kit. If you already have an estate plan in place, congrats! You have a great foundation and framework to go off of, and you can then make this month your time to review the likes of beneficiary designations. Do not leave such important decisions, which are wrapped up in estate plans, to chance. 


Just like estate planning, considerations associated with your lifestyle, health care, and other needs as you age are difficult and easy to “put off to another day.” By setting aside September as the month to sit down with your spouse, partner, and other loved ones to discuss these matters, you are being intentional and these discussions are more likely to actually occur! Plus, this month is ideal for such planning with kids going back to school and the academic year getting into full swing. Consider the likes of funding long-term care plans, and other insurance considerations that could affect your quality of life and overall health and wellbeing into your golden years. 


FOURTH QUARTER


Speaking of school, college funding need not be frightful in October. If you have little ones that won’t be so little before you know it, take the time to step up your game on this front. Get the kiddos engaged in planning for their futures, too. They can learn many personal finance and savings skills that are not traditionally taught in schools. In Nebraska, take a look at the NEST® 529 college savings accounts. Often, there are many state resources that coincide with College Savings Month in the fall and at year’s end (holiday gifting time), which should be explored and merit a closer look and at least annual reviews. Additionally, if you are making a career transition or looking to “upskill,” don’t leave money on the table by failing to take advantage of educational tax credits that you may be eligible to use to offset burdensome liabilities. 


Things really pick up in November, and not just from the perspective of the mad dash through the holidays. Your health insurance coverage demands attention here, with open enrollment kicking off. We also encourage our clients to take a closer look at any insurance coverages that may not have been properly reviewed or adjusted, as needed, in the previous months. This includes assessing the likes of premiums and coverages for home and auto, too. Don’t be at a loss regarding capital gains at year’s end. This month is typically when companies are communicating their estimated distributions before gains on mutual funds are distributed. So, it is advised to refrain from purchasing funds before this distribution period. 


Embody the true spirit of the holidays. December presents the last time for you to make tax-advantaged charitable contributions. Be mindful of year-end deadlines for taking Required Minimum Distributions form IRAs, 401 (k)s, and their ilk. Sound strategies to improve one’s portfolio may include pulling back on distributions from funds, stocks, and other holdings that are no longer fruitful. Instead, consider funneling some of that distribution toward the likes of qualified charitable contributions. Speaking of portfolios, it is only natural to conduct a big “inventory” or comprehensive review. We recently provided a breakdown on how to get off to the right start – and set you up for success in 2025 and beyond! 


At the beginning, we demystified how intentionality and planning can positively affect new year’s resolutions and goals as a whole. It was further noted that the best social support to help you achieve comes from those who really have skin in the game, who authentically want you to succeed. Nothing brings your friends at OFWF greater satisfaction than seeing our clients’ thrive in both their professional and personal lives, and we see it is a true reflection of our success.

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