image

business forward

Your Money: A quarterly financial to-do list for 2022 - TwinCities.com-Pioneer Press

We’re at year-end and what a remarkable year it has been. So much has been upended in our financial lives. But as we advise our clients, you need to control what you can control and pass

These are portraits of Bruce Helmer and Peg Webb, financial advisers at Wealth Enhancement Group and Pioneer Press business columnists Bruce Helmer and Peg Webb

everything else by without a second thought. By sticking to a well-constructed financial plan, you should be able to handle most curve balls thrown at you. Here’s a quarterly calendar to help you do that.

FIRST QUARTER (JANUARY TO MARCH): SET GOALS, REVIEW YOUR ESTATE PLAN, REDUCE CLUTTER

Out with the old, in with the new. January is a great time to identify personal and financial goals for the year, whether it’s to get more exercise and eat better, save more or pay down debt. The trick is to set specific goals, write them down and make them small and attainable. For example, commit to building an emergency fund by putting $200 a month into bank savings account. By the end of the year, you’ll have $2,400 in the bank to handle unexpected expenses.

Toward the end of the month, create a file to hold all your tax information, such as W-2s and 1099s.

Feb. 14 — Circle Valentine’s Day to remind yourself to protect the ones you love. Review your estate plan to make sure it’s up to date and check the beneficiary designations on your life insurance policies and IRAs to make sure your assets will go where you intend them to go.

March 13 — It’s not only a good time to change your smoke detector batteries, but also review your auto and home insurance policies to make sure you’re not over- or under-protected.

March 20 — the first day of spring, is a great time to simplify your financial life and reduce paper clutter by signing up for online bill pay and digital statements.

SECOND QUARTER (APRIL TO JUNE): PAY TAXES, REBALANCE PORTFOLIO AND CHECK ON YOUR PROGRESS

April 1 — Don’t be foolish on April Fool’s Day — check your credit reports to make sure there’s been no unauthorized activity in your credit card accounts due to identity theft, or a missed payment that’s negatively impacted your FICO score.

April 15 — Your federal and state tax returns are due; make sure you’ve maxed out your traditional or Roth IRA contributions for 2021.

April 18 — Tax Freedom Day represents how long Americans need to work to pay the nation’s tax burden. It’s also an opportunity to see how well your tax-deferred 401(k) and/or tax-advantaged Roth IRA are helping your progress toward your retirement goals. (But if you’re effectively diversified, you shouldn’t need to check on long-term retirement plans more than once or twice a year.)

May 8 and June 19 — If you have aging parents, take a little time on Mother’s and Father’s Day to think about their finances, health care needs, living arrangements and estate plan. Perhaps it’s time to have that tough but necessary talk about their lives’ next chapter.

June 30 — We’ll be halfway through the year, and it’s time to check your progress since setting your goals in January. Expenses higher than you hoped? Track your spending for the next three months to see where it all goes.

THIRD QUARTER (JULY TO SEPT.): ENJOY SUMMER, GET READY FOR BACK-TO-SCHOOL, PAY DOWN DEBT

July — This is one of the few months when nothing much happens, financially speaking. So, get out and enjoy the summer weather with your family. And if you have time, check your asset allocation in your long-term retirement accounts to make sure it is still aligned with your target stock/bond allocation. Consider rebalancing if one asset class has become too dominant due to recent strong performance.

August — It’s back-to-school time. Instead of spending all that money on shopping, set some education dollars aside in a 529 college savings plan or Education IRA.

Sept. 23 — It’s the first day of fall. Make it your personal goal to pay down any high-interest credit card debt before the leaves stop falling in Minnesota (usually late October in Central Minnesota and the Twin Cities, in case you’re wondering).

FOURTH QUARTER (OCT. TO DEC.): INCREASE SAVINGS, CHECK YOUR HEALTH, GIVE TO CHARITY

Mid-October — The IRS typically announces changes to retirement plan contribution limits and Social Security payouts around this time. Make sure you’re aware of the changes and consider increasing your deferrals during your company’s open enrollment season.

November — It’s National Long-Term Care Awareness Month. At some point in our lives, about 60% of us will need some help with things like getting dressed, driving to appointments or making meals. Considering the possibility of long-term care is a foundational element of financial planning.

December — Get in the holiday spirit by donating appreciated assets to charity instead of giving cash. The charity won’t have to pay capital gains tax, nor will you. And, as we close out 2021, let us be among the first to wish you and your family a healthy, happy and prosperous New Year.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

Bruce Helmer and Peg Webb are financial advisers at Wealth Enhancement Group and co-hosts of “Your Money” on WCCO 830AM on Sunday mornings. Email Bruce and Peg at [email protected] Securities offered through LPL Financial, member FINRA/SIPC. Advisory services offered through Wealth Enhancement Advisory Services, LLC, a registered investment advisor. Wealth Enhancement Group and Wealth Enhancement Advisory Services are separate entities from LPL Financial.

As you comment, please be respectful of other commenters and other viewpoints. Our goal with article comments is to provide a space for civil, informative and constructive conversations. We reserve the right to remove any comment we deem to be defamatory, rude, insulting to others, hateful, off-topic or reckless to the community. See our full terms of use here.