Big Benefits of Downsizing

Big Benefits of Downsizing

The old sayingless is moremay also hold true when it comes to the size of your home. It may be tempting to think that the best home is cavernous, with lots of extra square footage you can fill with possessions over time but thats not always the case. There are many potential short- and long-term benefits to downsizing. Here are just a few ways going small can help ensure your home remains a haven and not a hindrance to your financial goals. 

Lower PITI 

Downsizing has the potential to reduce your mortgage payments as well as many other costs associated with your home including taxes. For example, if you pay $6,100 a year in property taxes, moving to a home that costs 25% less could save you $127 a month. Your insurance premium may be lower for a smaller home as well due to reduced costs of labor and materials needed to affect repairs in the event of a claim.  

Small Space Efficiency 

A cozier home can reduce your environmental footprint and also help save on resources, particularly if youre downsizing your lawn as well. Youll have less area to maintain, making it easier to handle yard maintenance or other chores yourself instead of hiring someone to do it for you. Heating and cooling less square footage is typically less expensive, leading to lower utility bills and a potentially less costly HVAC system. Moreover, a smaller home can promote a more minimalist lifestyle, encouraging you to prioritize quality over quantity and cultivate a greater sense of contentment with fewer material possessions. 

Fortify Your Financial Future 

The economic benefits of downsizing are long lasting. A more affordable home can lead to valuable home equity, which could help fund retirement savings or other financial goals. A smaller home may also help you pay off your mortgage sooner, freeing up extra money each month to fund a dream vacation or an earlier or more comfortable retirement. And the savings youll accrue by downsizing mean youll be better equipped for a financial emergency. 

Good Things Can Come in Small Packages 

While many homebuyers may automatically aim for a bigger place each time they move, bigger isnt always better when it comes to your bottom line. If you assess your lifestyle honestly, you may find that your square footage exceeds your needs and is creating an unnecessary strain on your budget. Think carefully about your actual requirements, calculate what that unused space is really costing you and consider the many potential benefits of downsizing.  


Does Your Budget Need an Update?

Does Your Budget Need an Update?

Having a budget is a great way to take charge of your financial health. In fact, people who track their spending are more likely to owe under $5,000 in debt than those who dont. A budget can help you stay on track toward achieving goals like a secure retirement, but as your life changes, your budget may require updating from time to time. So, whether youre planning for your dream home, a vacation or a debt-free future, its important to make sure your budget reflects your current financial reality. Here are some common reasons you might need to reassess your budget. 

Changes in Income (Up or Down) 

If your income changes, adjust your budget accordingly. With a raise, you might want to allocate more money to savings or retirement accounts or pay down debt more rapidly. On the other hand, if you lose a job or face a pay cut, you may need to reduce a few discretionary expenses, such as eating out, until you’re able to recoup the lost income. 

Major (and Minor) Life Changes 

Major life changes, such as moving or purchasing a home, a serious illness, starting a family or getting married tend to significantly impact household budgets across several spending categories. But even less drastic changes, such as a costly home repair bill or a car purchase, will often require budgetary adjustments. In the event a complete overhaul is needed, it may be wise to seek out assistance from a qualified financial professional.  

Inflation (and Other Changing Economic Realities) 

In early 2023, the average price of eggs was 70% higher than in 2022. While eggs have become the poster child for inflation run amok, many other household expenses have also increased significantly. And taken together, these changes have stressed the financial health of American households and likely contributed toward soaring consumer debt. But by reworking your budget numbers, you may be able to avoid burdensome credit card bills in the future.  

Evolving Long- (and Short-) Term Financial Goals 

As your financial goals change, so too should your budget. If you once thought youd retire in Akron but have now decided you want to spend your golden years in Malibu, you might need to sock more away to make that retirement dream a reality. Rapidly increasing mortgage rates are changing the calculus for would-be home buyers; a budget can help you make adjustments based on shifting economic conditions. Consider your near-, mid- and long-term financial goals as you reassess your resources and needs. 

Changes in Credit Card (and Mortgage, Car Loan) Debt 

If you take on increased debt, whether its a new car payment, mortgage or medical bill, your budget will need to adjust to incorporate those payments. On the other hand, when you pay off a debt, it presents an opportunity to put more money toward paying down other obligations or putting more funds aside toward your retirement or other financial goals. What once was spent chipping away at a credit card balance could now be put toward your vacation fund or building up emergency savings for a rainy day. 

A Budget Is a Living Document 

Establishing a budget that works for you is an important step toward building a healthy financial future and securing your retirement readiness. But it will likely require several updates along the way. A midyear budget check is a great way to make sure your plans stay in step with all your life circumstances. If you need assistance, a financial professional can help you. 



Prevent Online Shopping from Busting Your Budget

Prevent Online Shopping from Busting Your Budget

From cat food to cars, commodities of all kinds are available to purchase online. And when clicking the “buy now” button is the only thing between you and a hefty credit card charge, it can be easy to overspend. Add online marketing algorithms to the equation, whereyou might also likeitems are served up at every turn, and your shopping cart can quickly fill up with things you didnt intend to buy and don’t need.  

If you find yourself choosingclick to purchaseincreasingly often, you are not alone. According to Forbes, more than 20% of retail purchases are expected to be made online in 2023. So how do you rein in spending when shopping from the comfort of your couch has become so convenient?  

Savvy shopping. Price comparison shopping has never been so easy. Online tools such as Google Shopping and PriceGrabber enable you to sort by many criteria including brand, customer rating and price, helping you make better, more informed buying decisions. Look at which retailers offer the product youre looking for and determine which one offers the best fit for your needs and budget. But stay focused on your intended purchase, and dont get lured into spending more than you intended by flash sales, pop-up ads and limited time offers. Also, avoid using online shopping asretail therapy,which can quickly lead to overspending and bloated credit card bills.  

Fee fiascos. Take shipping, processing and delivery fees into account when calculating your total price. Look for free shipping options but keep a close eye on the minimum price requirement. Sometimes free shipping can be a lure to get you to spend more than youd bargained for. Did you throw that cat hammock in your cart at the last minute just to score free shipping? Keep an eye on total costs and dont lose the forest for the trees.   

Trustworthy transactions. Online reviews can help guide shoppers toward quality purchases from reliable sellers. Consider checking independent review sites such as Yelp, Trip Advisor and Consumer Reports. Doing a little homework up front can help you avoid costly, time-consuming problems with disreputable dealers, such as poor product quality, failed delivery, or lack of warranty. Search through reviews to see how users who have made returns rate the sellers customer support. You may also want to use a credit card that offers purchase protection in case something goes awry with your transaction. 

Digital discounts. Use online coupon apps and tools to help score deals, such as or RetailMeNot. Beyond offering discounts, these sites make shopping even more convenient by listing a variety of deals in one place. You can find coupons for everything but dont get swayed into buying a can crusher or sweater nub shaver you dont really need just because of the 20% coupon you found online.  

Buying boundaries. To help minimize impulse buys, always make a shopping list. You may not use it to navigate the aisles of a supermarket or big box retailer, but a list can still help you stay on target with your spending by helping prevent wandering eyes when shopping at your favorite online retailer. The bottom line: If its not on your list, keep it out of your cart. When you visit a brick-and-mortar store with cash, there’s an automatic limit on what you can spend. But online shopping by default is done by credit card, so you must impose your own limits. 

Final Words of Wisdom 

And a few final quick tips before hitting the cybermall: opt out of online sales notifications, use ad blockers to avoid seeing ads targeted to your purchasing preferences and set time limits when perusing products online. Because when theres no limit to how much your shopping cart can hold and the store never closes, you can easily shoptill you drop too much of your hard-earned money.  



Overcoming Financial Anxiety

Overcoming Financial Anxiety

If you go by the numbers, financial anxiety is becoming something of an epidemic. Heading into 2023, more than half of Americans said they’ve faced financial challenges over the last year, according to a recent study — nearly a 20% increase over the year prior. But did you know those money woes could be taking a toll on your mental and physical health in addition to your pocketbook? And while some levels of stress can be motivating, too much can be paralyzing.  

But don’t lose hope. Here are five ways to combat your cash concerns and take control of your finances.  

1. Face Your Financial Fears 

Fear of the unknown can be a powerful force — and this is certainly true when it comes to your finances. It’s often more stressful to be in the dark about your situation than to face reality. So take a financial inventory. Write down your income, expenses, assets, debts, savings and retirement account balancesand more. If you know where you stand, you won’t add to your stress by playing out worst-case scenarios in your mind. 

2. Make a Written Plan With Actionable Steps 

Once you know your situation, creating a written financial plan can help further lower financial anxiety. Your plan should include a budget you can stick to, a strategy to pay down debt and specific action steps to help meet your goals. You could start saving a certain percentage or dollar amount from each paycheck by upping your 401(k) contributions, cutting certain discretionary expenses or picking up a side hustle. 

3. Create an Emergency Fund 

Having an emergency fund means you’re less likely to drain retirement savings or take on additional debt to cover unanticipated expenses like car repairs and medical bills. A good guideline to aim for is to keep at least three to six months of your regular expenses in a highly liquid savings or money market account (but not under the mattress). Knowing you can cover an emergency can give you greater peace of mind and help alleviate the kinds of worries that might be keeping you up at night. 

4. Practice Self-care 

Coping with economic fears isn’t just about adjusting your finances. It’s also important to make sure you’re practicing good self-care and maintaining the types of habits that support your overall physical and mental health. Getting enough sleep and exercise, maintaining a healthy diet and practicing stress management techniques such as meditation can help you process your financial fears in a healthier way. 

5. Seek Support  

Simply knowing that you're not alone can help. But seeking support from trusted friends and family, as well as expert help from a financial professional or licensed therapist, can be instrumental in putting financial anxiety in the rearview mirror. Some companies offer employee assistance programs that can be a valuable resource — check with your HR department to see if yours does. And if your employer offers a financial wellness program, you may have access to online tools and resources, group education or even one-on-one sessions to get the information you need. 

Tackle Financial Fears Head-on 

Financial stressors are a part of life that we can’t always avoid, but we can control how we deal with them. Creating a systematic plan and developing skills and tools to shore up your finances and improve your financial health is achievable no matter what your current situation is. Overcoming fears and regaining financial control can bring a sense of empowerment, reduce stress and pave the way for a brighter financial future. 



You’re Behind on Your Retirement Savings — Now What?

You’re Behind on Your Retirement Savings — Now What?

Are you looking to secure a comfortable retirement but dealing with a 401(k) balance that’s behind schedule? Whether youre just starting out or have been steadily contributing without hitting your savings goals, there are ways to give your balance a boost even if youre nearing retirement age. With some smart strategies, you can fortify your 401(k) and make steady progress on securing a sound financial future.   

Crank up Contributions 

In 2023, you can contribute up to $22,500 to your 401(k). For those 50 and older, the maximum allowance increases to $30,000that’s an additional $7,500 for “catch-up” contributions, which can help older workers fill any retirement fund gaps. But if maxing out all at once isnt in your budget, increase contributions annually by 1% until you hit your limit. And if your employer provides a match, try to increase your contributions to qualify for the maximum match as quickly as you can.  

Supplement Your Savings 

Amplifying your savings by funding some additional types of accounts can provide an extra cushion to help you retire comfortably. A health savings account (HSA), for example, can be a great way to supplement your retirement savings because it comes with a triple tax advantage: Contributions are made on a pre-tax basis, the interest and earnings are not taxed and withdrawals for qualified medical expenses are also tax-free. For additional retirement funds beyond annual 401(k) limits, you can also consider opening a traditional or Roth IRA especially if you have a side hustle or part-time job to help fund contributions. 

Ferret out Found Money 

If youve changed jobs and left your 401(k) behind, tracking down those funds and rolling them into your current plan could give you a more complete picture of your retirement savings. Even if you dont have contact information for your old plan sponsor, you still may be in luck. The Secure Act 2.0 of 2022 establishes plans for a future government-maintained “lost and found” database for retirement plans to help workers find and access their old accounts. 

Rethink Your Retirement Residence 

If youre significantly behind on retirement savings, you may need to rethink your plans a little. Maybe a waterfront beach house isnt in the cards, but a cozy condo thats a short drive to the boardwalk may still be within reach. It might be necessary to adjust your goals and expectations a bit to align with your current financial situation. But if youre dead set on your destination, you could also plan to work a little longer or bring in some extra income to make your retirement dreams a reality. 

Plan for Tomorrow, but Remember to Enjoy Today 

Regardless of how you try to increase your savings, its important that your strategy is something you can stick with and appropriate for your retirement time horizon. Avoid making excessively risky investments in an attempt to make up for a late start or insufficient contributions. Also, keep quality of life in mind youre trying to retire comfortably, but enjoying life now matters too. Pick areas in your budget to pull back, but dont cut back on all the things you like doing.  

A trusted financial professional can help you home in on a personalized approach that works for you and your goals. Your golden years will be here before you know it, so get your retirement plan on track today. 


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