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Sticking to a budget is hard enough normally — and things are anything but normal right now. Unfortunately, this is one more area of our lives that’s a lot more complicated since the pandemic began. Just as many folks are rethinking how they work and grocery shop, it’s a good idea to look at your household budget and consider whether some adjustments are in order.

Budgeting is about planning ahead. But before you do that, review changes in your spending habits since the COVID-19 crisis began. While it may feel like you’re saving money by eating out less or staying home, there may be other areas where you are, in fact, spending more than you did before the pandemic. These might include groceries, utilities and even household repairs, as appliances and other systems in your home deal with increased demand.

Once you have a good sense of the increases and decreases in your spending, adjust your budget accordingly. Then, consider the following:

1. Bolster your emergency fund. Whether or not you’ve had to tap your emergency fund, consider adding to your safety cushion. With the future still uncertain, see if you can squirrel away an extra $50 a month to put toward repairs or other unexpected expenses. Adding to your Flexible Spending Account (FSA) or Health Savings Account (HSA) can also help cover any unanticipated medical costs.

2. Review discretionary spending. Some budget items are necessary expenses, such as food, housing and utilities, while others are optional. Review your discretionary spending, such as multiple streaming services and nonessential clothing. Consider cutting back on these temporarily to liberate additional money for building your emergency fund or paying down debt.

3. Seek out savings on essential spending. Curb grocery bills by using paper or online coupons. Buy in bulk and look for lower-cost meal options that include pasta, beans and in-season vegetables. Cut back or eliminate alcohol purchases. Getting creative with leftovers can also help. Look for new budget-friendly recipes to add to your meal-planning repertoire. Many auto insurance carriers are offering discounted rates as well, so check to see if yours is one of them. You can lower monthly insurance payments by increasing your deductible, but only consider this strategy if you can afford the higher out-of-pocket expense.

4. Negotiate with creditors and service providers. If your budget is straining, speak to your lenders to see if they can lower your monthly payment or interest rate. They may even allow a forbearance of payments altogether. If you have a mortgage, investigate whether refinancing that loan makes sense for you. Call credit card companies and ask for a lower interest rate or consider a balance transfer to a card with a more favorable fee structure.

5. Review your retirement plan. Try to avoid dipping into your 401(k) as this could potentially set you back years on your retirement timeline — as can lowering or stopping contributions. It’s particularly important to contribute the minimum required to receive any company-match funds if possible.

Many American families are feeling the crunch right now. You’re not alone. Seek out guidance from those who can help. Setting an appointment with your financial advisor is a great place to start during this challenging time. If you’re under a great deal of financial stress, talk to supportive friends and family. And, if necessary, obtain professional help from your Employee Assistance Program (EAP) or a qualified counselor through your health insurance plan.

Having a financial advisor is like having a tennis or baseball coach. While you want them to track your performance throughout the year during routine practice, there are also key moments during a big game when you look to them for important advice. So, when exactly should you touch base with your advisor?

1. When you land your first job. This is an excellent time to schedule a meeting with an adviser about setting up a monthly budget and starting to save for retirement. If your employer offers a 401(k) plan, a financial advisor can help you decide how much to contribute and how to allocate your contributions.

2. When you leave or change jobs. If you’re taking a hit in income, your advisor can give you strategies about how to adjust your finances until you find that next job. And they can walk you through options regarding your 401(k) plan from your previous employer — such as rolling those funds into an IRA or transferring them into a 401(k) through your new job.

3. When you get married. Getting married can change your personal finances significantly. Are you going to merge your funds or keep them separate? If you are now going to be a dual–income family, what will you do with that additional income? What about life insurance needs?

4. When buying or selling a home. An advisor can help you figure out exactly how much house you can afford and, along with a tax professional, plan for any tax consequences. Finally, he or she can help you adjust your budget to accommodate all of your home mortgage and maintenance needs as well as continue to invest toward retirement.

5. When you have children. Children are bundles of joy that can also cost your bundle. Getting professional advice about how to manage child-rearing expenses can be extremely beneficial. An advisor can also help you set up a dedicated college fund to plan for your child’s educational needs down the road.

6. When you receive an unexpected windfall. Whether it’s a large bonus or an inheritance, you want to plan for any unanticipated funds. There can be tax obligations, and you need to make decisions about how to spend or invest that money.

7. When you’re about to retire. The transition from your income-generating years to retirement can be tricky to navigate. Working with a financial planner all along will help smooth out the transition. However, there will still be adjustments to how you manage your money, and an advisor can help you during this critical time.

8. Every 6 to 12 months if nothing major has changed. It’s important to touch base regularly with your advisor, even if your circumstances remain more or less the same. Periodically review your progress toward your retirement and other financial goals, such as debt reduction.

A good financial advisor can help you train and prepare, recover from injury, and come up with a game-winning strategy to get you over the goal line to your retirement years.

There are plenty of ways to romance your sweetheart without breaking the bank. All it takes is a little planning and creativity.

Dining on a Dime

Dinner reservations may be difficult to book this February 14^th, and even if you can score one, it’ll probably come with a hefty price tag. Why not cook up a meal from scratch with some romantic ambiance at home? Lay out a white tablecloth, light some tapers, eat off the good china and prepare a dish they’ll love, whether it’s spaghetti and meatballs, chicken cordon bleu or stir-fried veggies with tofu. You can linger at the table as long as you want, and you don’t need to leave a tip.

Cut Candy Costs

Forgo the pricey store-bought chocolates for a sweet home-baked treat. The price of fancy foil-wrapped confections in heart-shaped boxes can be a budget buster. But you can do something a lot more unique that shows you’ve put your heart into each and every delicious bite. Bake a batch of mini cookies, cupcakes or homemade fudge and pack a love note with them.

Frugal Flowers

Red roses are so commonplace on Valentine’s Day that they’ve become almost cliché. Break the norm — and save money — by giving your loved one his or her favorite flower, whatever that may be. A bouquet of daisies, peonies or gardenias with their amazing perfume can go a long way toward helping your romance bloom. Or gift a live flowering plant to symbolize how your love will grow over time.

Gift Thrift

Present your sweetheart with one of these frugal-but-fabulous tokens of your affection.

1. Budget-friendly bauble. If you want to give jewelry but can’t afford something 14-karat, take a stroll to the local vintage shop and find an interesting treasure with a history for a fraction of the price such as a ruby red rhinestone or a sterling silver locket.

2. Memory montage. Another great idea is a small photo album. As most photographs stay on hard drives these days, a memory album is a lovely keepsake. Be sure to add some blank pages at the end to leave room for the memories you’ll make together in the future.  

3. Love story. Purchase a poetry book, a love story or even a coffee table book of Renaissance artwork. Then, inscribe it with a dedication. Remember, you don’t have to be Shakespeare — it’s the sentiment that counts. 

Economical Entertainment

There are plenty of low-cost, high-romance activities to choose from. How about a romantic stroll through a museum gazing at masterpieces depicting lovers through the ages? Or visit a public garden and steal a kiss among the snowdrops? If it’s cold enough, head out for some ice skating and then snuggle by the fire with a cup of hot cocoa — with marshmallows of course!

The Finale

Wrap up the night by lighting some candles and slow dancing to a personalized playlist of your favorite ballads. Remember that the best things in life are often the things that money can’t buy.

Creating and maintaining a household budget is a powerful tool for achieving financial goals. But these eight budgetary blunders could tank your best efforts to stay on track.

1. Omitting occasional expenses. You (hopefully) don’t have to repair your car on a monthly basis, but it’s unrealistic to pretend it’ll never happen. And just because you don’t know when the next breakdown will be, that doesn’t mean you should leave an occasional bill from your mechanic out of your budget. For unpredictable expenses like these, look back at the cost of prior repairs for an average figure to factor into your budget. As your car gets older, you may want to adjust that estimate up a bit as you’ll have a greater chance of more extensive repairs with a “mature” vehicle.

2. Forgetting about small purchases. That daily cup of joe at the train station may not cost you much, but little things can add up when they’re repeat offenders. Capture small expenses like these in your monthly budget. Include things like tips on services and your Sunday morning bagel run.

3. Ignoring large purchases. How do you budget for a big two-week summer vacation? It’s important to have a plan if you don’t want to end up with a gigantic credit card bill as a final souvenir of your beach getaway. Tackle large expenses like these by dividing the total cost by 12 and including that amount in a monthly savings budget. That way, by the time you pack your bathing suit and sunscreen, your fun-times fund will be able to cover your costs.

4. Relying on memory. When you review your spending at the end of the month, it’s easy to forget a purchase here and there. This is why it can be helpful to look back at electronic banking records to account for every dollar spent. After all, if you don’t accurately align your spending with your budget, what’s the point of making one to begin with?

5. Leaving no wiggle room. Always reserve a little cushion in your budget just in case. It’s pretty hard to anticipate every expense that might come up during the month, so don’t budget down to the penny – allow some wiggle room in case you’re overly optimistic in your projections.

6. Not paying yourself first. Don’t let planning for your future become an afterthought. Make it a top priority each and every month. Participating in your employer-sponsored 401(k) plan is a great way to make retirement saving automatic. And when by making regular contributions, you’ll dollar cost average into the market, which means you’ll accrue more shares when prices are lower. And everyone likes a bargain, right?

7. Being too hard on yourself. Sticking to a budget takes practice and discipline. You might not hit your target each and every month, but it’s important not to beat yourself up if that happens. Try to understand what occurred, make adjustments based on what you learn and get right back on track. You don’t need to budget perfectly to make a positive impact on your financial future.

8. Going it alone. Your employer-provided financial advisor is a fantastic resource. Budgeting can be complicated, and your advisor can help you sort through the details. Make an appointment to review your budget or get help setting one up for the first time.

Making — and maintaining — a budget is one of the best things you can do to stay on track for your retirement and other financial goals.

complicated decision that would also benefit from an open discussion with your financial advisor. Taking benefits early can affect how much you can earn without your Social Security

benefits being reduced. Many people don’t realize that a large portion of their benefits may also be taxable.

4.  Get a handle on Medicare. What you’ll end up paying for your Medicare benefits depends on several factors, including your income. Medicare is a complicated program and you don’t want to be figuring it all out at the last minute, so now is a good time to do your homework and speak to your financial and/or Medicare advisor. According to research from Fidelity Investments, the average 65-year-old couple will spend more than a quarter million dollars for health care over the rest of their lives. Having Medicare and the right supplemental insurance is critical in planning for this phase of your life.

5.  Finish your estate plan. If you haven’t already, take care of your will, durable power of attorney, healthcare power of attorney, and/or advanced directives. Other documents such as a trust, guardianship designation or letter of intent may also be appropriate. Consult an estate planning lawyer regarding your specific needs.

6.  Reassess investments. Hopefully you’ve been keeping a watchful eye all along, but if not, it’s especially important to reevaluate your allocations before retiring. Your portfolio may not have time to recover from a serious market downturn. Check risk in all your retirement accounts. Make sure your market exposure is appropriate given your age and risk tolerance.

7.  Plan your free time. You’re retiring soon and that means your life is about to undergo major changes — and not all of them financial. Your daily rituals will be different and you may not be seeing a lot of the same people day to day. While sleeping in and hitting the links may be satisfying in the short term, for some it may gradually give way to boredom or depression. Consider joining some clubs or volunteering to keep yourself busy and meet new people. Couples who may have never spent all day long together may also need a little time to readjust to a new routine.

Source: https://www.cnbc.com/2018/11/02/if-youre-planning-to-retire-in-2019-heres-how-to- make-sure-youre-prepared.html

Tags: estate planning, retirement, budget, estate