Industry Insights

A Financially Bright New Year

This year has offered many trials and tribulations compared to what might have been expected this time last year. Although we faced many tragedies, we are entering a bright, new, hopeful year. We must look on to the prospects next year may bring, and celebrate our perseverance through this one. One thing that has changed for the better is our new perspective of time and money.

Time has slowed down, allowing opportunity for reflection on where your money is, what you have saved, what you have spent, and how it is working for you. With more time on your hands, this is a great chance to take advantage of planning and completing a financial checklist for 2021. Some things this may include are:

  • Revisiting your investment portfolio and making sure it is both balanced and diversified. (helpful tip: your FIDELIS iM advisor can help with this).
  • Re-evaluating your emergency savings, looking at what you spent versus what you saved, and adjusting if needed.
  • Examining your spending habits such as weekly food deliveries or Amazon shopping.

Often our worst spending habits are things we are not aware of. By having a good idea where your money was spent over a longer time frame, you can decide to continue or change these behaviors. This personal financial evaluation will help you prepare for your future, while ensuring you are properly set up for the present and any emergencies that may take place.

Many people have found themselves saving more than normal because of the slower style of life. With the extra money that you have saved, it is a great time to max out your retirement savings plan, $19,500 and an extra $6,500 as a catch up for those over the age of 50 in a 401(k) or 403(b). Traditional IRA and Roth IRA contributions are an option as well. Health Saving Accounts also allow you to contribute up until April 15. For 2021, the IRS increased individual contribution limits to $3,600 and family contributions to $7,200; a $50 and $100 increase over 2020, respectively.

Once you have a good understanding of your finances, spending, and savings, create goals for the upcoming year. By creating and writing down your goals, they serve as reminders when you are faced with financial choices. Some goals that can help prepare you for the future include:

  • Buying a home or refinancing your mortgage to take advantage of historically low rates.
  • Contributing more money to your kid’s college savings account.
  • Maxing out your retirement for the year or adding to your investment portfolio.

If you are looking for ways to give back this year, look to local charities that have helped those most in need during the challenges of 2020. Whether it be a cash donation, an extra tip, old clothes, unused household items, or your time, your local community could use a little extra kindness this year.

At FIDELIS iM, we are grateful for all of our friends and family and for their discipline and good judgment through such volatile times. We will continue to persevere; to provide guidance and peace of mind to those we serve. Cheers to the year ahead and to a year filled with hope, health, and happiness.

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