With 2020 upon us, it is time to set your New Year’s resolutions. The start of a new year is the perfect time to review your financial presence and plan for your financial future. Not only is it a common time of year for people to set new goals, but it is actually a practical time to review your finances because you will have all of the data you need easily accessible, including your W-2s, 401(k) statements, 12-month bank statements, investment dividends, year-end tax statements and more. All of this information will help you set your financial New Year’s resolutions. However, we have a few suggestions to start your list as well!
- Start a 529 plan
- Starting a 529 plan for your children or grandchildren is a great way to save for higher education. Earnings in 529 plans accumulate on a tax-deferred basis and distributions are not taxed federally when used for qualified higher education expenses.
- Increase your 401(k) contribution
- Increasing your 401(k) contribution to ensure you receive the maximum in match from your employer is an easy way to increase your retirement savings. Your employer is giving you free money to help with your retirement, and you should take advantage of it. Review your documents or talk with your plan administrator so you know what your employer match plan is.
- Open a Roth IRA account
- If you have increased your 401(k) and are receiving the maximum employer contribution, you may qualify to open a Roth IRA, which is another great way to increase your retirement savings. The benefit to a Roth IRA account is qualified withdrawals from the Roth IRA plan are tax-free and do not penalize you. Growth in the account is also tax-free.
Set Your 2020 Financial New Year’s Resolutions Now!
Now that you have a few ideas on how to increase your retirement savings for 2020. What else do you want to accomplish to set yourself and your family up for financial success in the New Year? At Wentz Financial Group, we will help prepare a customized financial plan for you based on your goals and resolutions. Let us help you!