5 Financial Steps To Kick Off The New Year

Power Company WorkerStart the new year by setting your financial goals and making a plan to reach them. The following steps can help transform your financial dreams into reality:

Set short-term goals. Think about special things you’d like to do with your money over the next few years, such as paying for summer vacation, buying a car, or saving for a down payment on a home. Figure how much you’ll have to set aside each month to reach your goals; the earlier you start, the less you’ll need to save from each paycheck.

Review your spending. Keeping track of spending for just one week can help you identify ways to cut back — whether it’s packing lunch more often or spending less at the office vending machine. Then put the extra money toward saving for your goals. The Small Change, Big Savings calculator (www.icmarc.org/smallchange) can offer inspiration by showing the long-term impact.

Save more on monthly expenses. Review your regular bills to look for savings. Can you pay less for your cell service, or qualify for extra car insurance discounts, or reduce your student loan payments?

Pay off high-interest debt. The less you spend on high-interest charges, the more money you’ll have to save for your goals.

Save for the future. Don’t forget to save for long-term goals, too. Make the most of tax-advantaged retirement savings. You can save up to $18,500 in your 457 plan in 2018 and $5,500 in an IRA. (People age 50 or older can save $24,500 in a 457 and $6,500 in an IRA.) Your contributions may qualify you for the retirement savers' tax credit, which can cut your tax bill by up to $1,000. See www.icmarc.org/saverscredit.


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