Financial Planning 2022: 5 Key New Year Resolutions
This is the financial plan for 2022, the time for personal financial decision making. “Whatever you do, don’t stand like a deer in your headlights,” said Meredith Stoddard, vice president of Fidelity Investments Life.
In fact, most people are optimistic about the private sector in 2022.
This is despite ongoing coronary heart disease, the emergence of the omicron version of Covid-19, the threat of war in Ukraine, trade problems with China, rising inflation, rising interest rates and uncertainty about future markets. season. For many years.
Americans are optimistic because many people know that the economy as a whole has grown more than it has lost over time. And they know it will rise more than it falls.
Financial Planning 2022: Time To Act
This includes, for example, the last 10 of 11 years, including a jump of 28.71 in 2021.
Not surprisingly, a new survey from Fidelity Investments found that 72 percent of Americans will trust it by 2022. Their financial situation will be better than it is today.
To achieve this, 68% consider the financial commitment to the new year two or three or more.
Don’t just talk about improving your chances in 2022. Better than now. Take concrete steps to improve your finances.
And remember: you can definitely do more than you think. “Don’t worry about staying with Jones,” Stoddard said. Especially if Jones is rich like Jeff Bezos or Elon Musk. “But judge yourself by what you can do.”
Experts agree that in 2022. You can certainly make 10 steps included in your financial plan.
Accept financial commitments in the new year
Decision #1, make an overall financial plan if you don’t have one. List your short and long term goals. Buying a home, raising children, retirement.
How much does each one cost? Do you need money fast? How do you spend money on each cause?
When deciding how to invest, the size and timing of your goals are two important factors. The third question is, how much market volatility can you put on the road? This is risk tolerance.
These three factors are key to the type of investment you plan to make, especially the different parts of your fund portfolio.
Stocks and bonds are generally more volatile than bonds. Small and foreign stocks contain more than large US stocks. You know how it works.
From the global side of your portfolio, choose funds that reflect your goals, timeline and risk tolerance.
Is it time for balance?
Solution 2 balances the distribution of your assets between the mutual fund and the ETF portfolio division.
In a good year, various assets, such as large stocks, grow more than, for example, bonds. So make sure once a year that your asset allocation is still in line with your goals. If not, send it back.
The easiest way to do this is to shift payments to 2022 and categories that are not below the target weight. “Make sure your investments are in line with your long-term investment goals and risk tolerance,” said Kirsten Hunter Peterson, director of Fidelity Workplace Thought.
If you are not new to investing in individual stocks, check out the use of IBD in 2022.
Financial Planning 2022: Inventory
Decision # 3: Evaluate your personal finances. We recommend that you do this when evaluating your portfolio to see if you need to rebalance your assets. Do you have big problems in 2022? Someone who can ruin your budget? Make a simple budget, write down your expenses and income for 2022.
Decree No. 4 concerns the organization of the manor. Check your financial and insurance account. Make sure the recipients on your list are the people you still need. Have your financial priorities changed due to divorce, divorce, children, grandchildren?
As for insurance, is your life insurance still current? Decision # 5 includes questions about basic insurance and making sure you and your loved ones are insured.
When you die, “what percentage of your income should go to your family and for how long?” Cannon said. “Are there huge debts that weigh on abandoned loved ones? Does your family have future goals, such as educating their children?
Does your policy offer a high enough death toll? If not, how much does it really cost to buy? What about long-term care for you?
Decision 6 is another possible home help. Add tuition fees to your loved ones you want to help or fund.
New Year Resolutions: Pay Down Debt
Debt is a financial loop around your neck. Do you remember the true statement of US financial targets for 2022? “Debt settlement was one of the top three goals,” Stoddard said.
Your second of the three main goals in your decision is not. 8 – Fund emergency savings. Surprisingly, about 50 percent of American adults can barely afford to pay $400 in emergency expenses, according to the Central Bank of Minneapolis. However, if you book for just $8 a week, you’ll have $400 in less than a year. Saving $10 a week will save you $1,000 in less than two years.
Fidelity Surveys 2022 financial solution? Save more. This is solution number 9. Saving your pension is a priority.
Did you say you can’t afford it? Also try to save a small amount. “It’s important,” Stoddard said. “If you save $50 a month, you’ll have up to $600 at the end of the year. In 10 years, you’ll have $6,000.
And it’s hard to believe that your savings are earning a return. For example, according to Morningstar Direct, the broad stock market in the form of the S&P 500 has grown an average of 9.33% per year in the 20 years ended November 30. “If you invest your money, rule 72 says that if you apply an annual interest rate of 7 percent, you will double your money in 10 years,” Stoddard said.