Financial Tips to Start 2024 Off on the Right Foot

Dec 3, 2023

Updated December 2023

With the new year just around the bend, we’re sure many of you are thinking about how you are going to achieve your New Year’s resolutions. Whatever goals or aspirations you set for yourself in 2024, we have 8 tips/resolutions to get you closer to achieving all of your financial goals. If they are not already on your list, we encourage you to add them!

1. Set, Prioritize, and Plan for Your Financial Goals

Before any plan can be made, you need to know what is important to you and what exactly you are saving for. This involves defining and planning for short-term cash needs, large expected expenditures, and what you have your sights on for the long-term. The benefits of planning sooner rather than later are that you will not have to resort to a less than favorable last minute solution if you are left with a shortfall when expenses arise and it helps you stay on track for the longer-term goals.

2. Create a Budget and Be Aware of Your Spending

A budget will make you more aware of what you are spending your money on, so you can more easily recognize unnecessary expenditures, and in turn save more towards your goals. Budgeting can also help you reduce or more quickly eliminate debt, which can save you money in interest and penalties – which may seem small now, but can add up over time!

3. Increase / Maximize Your Retirement Savings

The contribution limits for IRAs and 401(k)s typically increase annually, so make sure that you adjust your contribution amounts accordingly. For 2024, the annual contribution limit for IRAs and Roth IRAs is $7,000 and $8,000 if you are 50 or older, and for SEP-IRAs the maximum contribution amount is $69,000. The 401(k) contribution limit for 2024 is $23,000, and the catch-up limit is $30,500.

4. Evaluate Your Insurance Coverages

This includes your auto, homeowners, and life insurance policies. Not only is it a good idea to compare the cost of your policies with that offered by other carriers, but it is also important to regularly review your coverages to ensure they are sufficient for your needs and are aligned with your goals.

5. Assess Your Financial Plan and Investment Allocation

Commit to sitting down with your financial advisor for an assessment of both your short-term goals to ensure you have cash available but to also provide updates for any longer-term goals to ensure that any necessary rebalancing can take place. Also, outside of any updates to your plan, take the time to think about and consider your current investment allocation to make sure that you are personally comfortable with the risk, so that you can continue to stay on track for your goals.

6. Evaluate Your Employee Benefits

Open enrollment for benefits has already passed for many of us, but do you truly understand your coverage and all of the options available to you? Or have you merely just kept the same insurance you have had in place for years just because it seems ok? Now is a great time to evaluate the choices your employer offers you to see if you are paying too much out of pocket for your health, dental, life and disability insurances. Could you be better off shopping for these products on the open market? In addition to insurance, are you aware of the other benefits your employer might be offering you such as pre-tax commuter accounts and legal plans. Some benefits can sound similar, such as an HSA (Health Spending Account) and an FSA (Flexible Spending Account) have numerous important differences. Do you fully understand what the similarities and differences are?

7. Review and/or Complete Your Estate Plan

This involves numerous items including reviewing your account beneficiaries, update or create your trust, coordinate asset titling with the rest of your estate plan and get your health care directive and durable power of attorney in place. Both your financial advisor and estate planning attorney are good resources to connect with to discuss these items. Make this the year that you get your estate plan in order.

8. Be Prepared for Tax Filing

Make sure that you keep an eye out for the investment tax documents that will start coming your way at the end of the January and accumulate any other tax information to make filing as least stressful as possible. For the upcoming tax year, make sure to check your tax withholding. It is very easy step you can take to avoid tax surprises down the road.

With these 8 steps, you’ll be primed for a great financial year! Be sure to include your financial planner in any changes you make to ensure that your plan is aligned with your overall goals and strategy for the year!

Peninsula Wealth is a Registered Investment Adviser. Advisory services are only offered to clients or prospective clients where Peninsula Wealth and its representatives are properly licensed or exempt from licensure. This material is solely for informational purposes. Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital. No advice may be rendered by Peninsula Wealth unless a client service agreement is in place. It is expressly understood that our firm will not provide accounting or legal advice nor prepare any accounting or legal documents for the implementation of your financial planning objectives.