Session 1a: Automate My Savings
A recent study found that people who automate saving toward their goals achieved a 73% increase in savings over people who didn’t. The bottom line: you’ll save more (and avoid temptation to spend) by automatically saving toward your goals each month.
Tip: Most institutions let you set up multiple savings accounts. Use each one for a particular goal and automate funds distribution to each one. It may seem like a small thing, but anything that will help you stay motivated to stack up those funds is worthwhile. Your Credit Union has something tailor made: our “My Account” savings club lets you name your account whatever you like (within reason of course) and get healthy interest. Learn more here.
Session 1b: Review My Retirement Plans
Because taxes and retirement considerations are so intertwined, it’s a solid idea to do an annual review of your individual account elections and your overall retirement plan once you’ve completed your filing with the IRS. A few of the questions to ask yourself:
- Am I contributing as much as I could be to retirement?
- Am I maximizing matching employer contributions?
- Does the risk tolerance of my investments still match my target retirement date?
- Does my asset allocation need rebalancing?
- Are there retirement plans from past employers I could roll over into an Individual Retirement Account (IRA) for easier management?
- Do I need to set up an appointment with a professional to review my retirement strategy?
Tip: Keep in mind that the annual deadline for making a contribution to an IRA is the tax-filing deadline date of the following year. For example, if your next taxes are due April 18 2024, you have until then to make a contribution for the previous year.
Session 2a: Check My Credit Reports
Saving is only half of the story. To borrow money on good terms and in consequence to accumulate lower levels of debt, you need good credit. And to improve or maintain your score, it’s a good idea to know what it is and what’s in your credit reports. Did you know that you’re entitled by federal law to free copies of your credit files from the three major bureaus every year, so there’s no reason not to take advantage of this service? Even if you think you’re aware of everything on your reports, it’s wise to check them because, according to the Federal Trade Commission, 79% of all credit reports contain errors. Many of these errors are harmless, but some could cost you big in the form of higher interest rates or denied credit. Once you’ve received your reports, check them meticulously for mistakes and dispute incorrect information. Your Credit Union also offers free Credit Reporting when you sign up for free Savvy Money. This service provides practical ways to improve your financial life, including tips on improving your credit score and reducing debt. Plus, you’ll get notified when a change has been made to your credit report and credit scores have been updated.
Tip: The dispute process can take several months to finish, so if you’ve got a major financial transaction coming up, like buying a home or a car, plan to review your reports well in advance. You may have heard the rumor that viewing your reports lowers your scores, but this is absolutely false.
Session 2b: Plan to Reduce My Debts
Don’t shred or delete those credit reports just yet. They’re an excellent resource for compiling all your outstanding debts as a step toward eliminating your financial liabilities. However you choose to reduce debt, freeing yourself from negative investments in your future can be one of the greatest financial gifts you’ll ever give yourself and will help build wealth.
Tip: Be aware―not all debts show up on credit reports. Some debts, like past due utility bills or certain medical obligations, may not appear. As part of eliminating your debts, make a note of any collections letters, emails, or phone calls you receive for outstanding obligations. Engaging with this information can be painful or frustrating, but the relief you’ll feel when it’s all handled will be worth it.