2022 is more than halfway over- crazy, I know! However, the end of summer is always a great checkpoint to take a step back, look at your finances as a whole, see what you have achieved thus far in the year, and re-assess your goals for year-end. We know it’s been quite a wild first half of the year in the world and in the markets, in fact, it has been the worst first half on record since 1970, along with 40-year high inflation data, the Russia-Ukraine war, the Federal Reserve hiking interest rates, and more, which makes this year’s mid-year check-up even more prudent.
So, as you take a look at your finances and prepare for fall and back-to-school time, let’s look at some steps you can take to reach your financial milestones. First and foremost, get organized. Organization and knowing everything you have and its location is something many individuals lack when it comes to their finances. Consider automating your finances all into one place so you have it easily accessible and at your fingertips.
Once you have organized and consolidated your financial accounts, think about fulfilling your goal buckets, such as your emergency fund, 401(k), IRA, HSA, and regular brokerage account. The extreme volatility year to date may be having you rethink your risk tolerance and attitude towards investing; however, it’s important to make sure that you don’t let volatility completely derail your long-term financial plan.
One goal you might want to focus on during the second half of the year is funding your emergency fund and buckets for large purchases. It’s always a good idea to have an emergency fund available to you in the event of a rainy day, so come up with a number that is comfortable to you and try to reach it. Additionally, if you have a large purchase coming up and don’t want to put that money at risk, consider setting those funds aside in a high yield savings account or an FDIC insured CD. Next, think about what you want to contribute before year end to your 401(K), HSAs, and 529s. For updated 2022 contribution limits, check out our blog here. While these are only a few ways one can maximize their finances before the end of the year, it’s important you revisit your goals and see where you are in reaching them for the year.
