Your Fall Financial Checklist

As we embrace fall and the colder weather, it makes 2022 a little more real being around the corner. This is a great time to start thinking about what you can do to save some money, prepare for the following months, and improve your life.

Looking for fall financial tips and money moves to complete before the year is over? It’s not just the end of the year that comes with a full list to check off. Now is a fantastic time to get a head start on your year end finances

Today, let’s explore fall money tips, smart money moves, and having a fall financial checklist to help you make fall a productive and good season – and year – ahead.

Health Insurance 2022

Open enrollment for 2022 through the Health Insurance Marketplace, starts on Monday, November 1 and you have to enroll by December 15, 2021 for coverage that starts January 1, 2022. If you have private health insurance or health insurance through your employer, you will want to find out what important dates you need to sign up for or get information from them, so that you do not miss out.

Most advisors recommend doing as much research as you can early on, to make sure that you have the best health insurance plan for you and your family. It’s not recommended to wait until the last moment, as you will probably be quite busy with the holidays and this can add a lot of stress.

Maxing out 401(k) retirement savings 

If your company offers a 401(k) plan, it can be an easy way to start saving for the future, even if you start small. Not only are contributions to your 401(k) excluded from your taxable income, but if your company offers a match, then you are essentially getting free money as well.

Many people don’t explore maxing out their 401(k) because they don’t feel like it’s a possibility or lack educating themselves on the process. Once people do try, they could end up kicking themselves for wondering why they didn’t max out their 401(k) sooner. The maximum 401(k) contribution limit for 2021 is $19,500. The amount is unchanged from 2020, but it is up from $19,000 in 2019. 

Given the historical maximum 401(k) contribution limit tends to go up $500 every two or three years, it is likely the maximum 401(k) contribution limit for 2022 will rise to a record $20,000. If you are 50 or older, you can add up to $6,000 extra per year from $5,500. This is the government’s way of allowing older workers with typically higher incomes to catch up. Even if you can’t max it out, see if there’s any more that you can contribute to your savings and retirement funds.

​​Don’t Forget RMDs 

Required Minimum Distributions (RMDs) is the amount of money that must be withdrawn from an employer-sponsored retirement plan, traditional IRA, SEP, or SIMPLE individual retirement account (IRA) by owners and qualified retirement plan participants of retirement age.

Did you turn 72 earlier this year, or did you turn 70½ before January 1, 2020? Many seniors are surprised to learn there’s actually a penalty if they don’t take timely distributions from their IRA. The tax penalty for failure to withdraw the full RMD amount, can be as high as 50% of the required shortfall. Taking RMDs has tax implications, but knowing now what you will be taking for the rest of the year can help with the other strategies we are recommending. If you have any concerns, this is the perfect time to talk to your advisor. Like you, they are busy with end of year activities, and they can walk you through any end-of-year questions. 

Holiday Budget

Lastly, it’s important to always budget for the holidays. With the end of the year around the corner, it’s easy for all of these expenses to add up. Especially if you’re planning on traveling this holiday season. With Halloween, Thanksgiving, Christmas, New Year’s, and many other holidays, the holiday season can be expensive.

Start by creating a holiday budget. For example, how much do you plan on spending on gifts, travel, and costumes this year? Many begin setting aside money for the holidays, especially when it comes to Christmas shopping for your loved ones. Find ways to make extra money, if you think your budget is cutting it close

Last Thoughts

With only a few months left in 2021, it’s time to revisit your finances to see what you need to do to finish out the year strong.  Make sure you’re making your checklist and checking it twice this season!

If you have any questions regarding retirement savings, money management, investment strategies and tax planning for 2022, it’s always important to check in with your trusted financial advisor at Johnson Wealth and Income Management. Our commitment is to help you work towards achieving all your financial goals and to help provide you with a “worry free” retirement.

For more information contact us today!


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