Stave off falling behind

Take a close look at savings, plan for 2022 fiscal goals

Fall is the perfect time to review your finances because there’s still time to make adjustments before the end of the year. The pandemic and economic uncertainty are making it more complicated, but financial experts recommend taking a look at your savings and planning for 2022 goals now.

Many government programs, including supplemental unemployment assistance, a pause on federal student loan payments and advance child tax credit payments, are poised to expire.

“People are going back to having to pay for stuff,” said Malcolm Ethridge, a certified financial planner and host of the Tech Money Podcast.

Here are some financial to-do’s to tackle this fall:

Ramp up savings

Ethridge suggests preparing for the phaseout of government benefits now: “The folks who received a moratorium on your student loans, use those additional dollars in your pocket to pay off credit card debt so you don’t have to pay both simultaneously. We will find out we aren’t as rich as we felt we were in the last year and a half,” he said.

Ethridge also recommends building a cash pile. “We have no idea what next year will look like.”

Anticipate tax changes

If you’ve undergone any major changes in the past year that could have an impact on your tax situation, such as moving to a new state, getting married or divorced, or changing jobs, then you might want to consider talking to a tax professional now, before their busy season begins in the new year and they are overwhelmed.

“They work long hours and are focused on processing tax returns in the spring, and that’s not a good time for them to deep dive into your situation or give you strategic guidance,” said Angela Moore, CFP and founder of Modern Money Education, which offers online personal finance courses for women.

Reflect on 2021

“It’s a good time to reflect: Did we do what we said we were going to do?” said Christine Centeno, CFP and founder of Simplicity Wealth Management. She recommends looking back at your savings and spending over the past six to 12 months to make adjustments.

Open enrollment, when employees can make selections related to health insurance and other workplace benefits like life insurance, also tends to take place before the end of the year. Centeno suggests combing through the options before making a final choice and consider needed supplemental insurance, such as disability or life insurance. Also, update your listed beneficiaries. “People feel more urgency about getting things in order” because of the pandemic, she said.

Top off contributions

“See if you can increase your retirement contributions and maximize them before the year end,” Moore said. You can continue to contribute up to $19,500 to your 401(k) through Dec. 31; if you are 50 or older, you can contribute an additional $6,500 for the year. Roth IRA or IRA contributions can continue until the April 15 tax deadline.

Get ready for 2022

Lazetta Rainey Braxton, CFP and co-CEO of 2050 Wealth Partners, said some people are also thinking about job changes.

“For a lot of people, they don’t want to return to in-person workplaces, so they are looking at new jobs.” If that’s the case, then you might need to set aside extra cash for a job transition, especially if it could mean a lower salary, she said.

Other 2022 goals might include taking a vacation that was deferred earlier in the pandemic or renovating part of your house that you’ve been spending so much time in. “The sooner people say what they want and put it on the table, you can set that money aside so you’re ready,” Braxton said.

Planning also means preparing for continued economic turbulence, warns Frank Pare, CFP and president and managing partner of PF Wealth Management Group.

“If something happens, like the market tanks tomorrow, money should be set aside for your nearterm goals so that uncertainty wouldn’t impact you,” he said. That way, you can continue with your plans, whether it’s to retire or take a trip.