A timely alternative to watching the Big Game

Today is Super Bowl Sunday and for the first time, I may not watch the game. In my heart, our beloved Lions should be one of the participants. And since I feel so many of you are also too heartbroken to watch, I suggest you consider spending some time on your finances.

It’s a great opportunity to close the books on last year and get things in good order for 2024. After all, that Federal Tax filing deadline can sneak up on you.

By now, most 1099 tax forms and all other pertinent year-end reports should be rolling in. Uncle Sam has made it so much easier for individuals to file their returns, but if you own a small business, it’s still quite complex. That being said, I’m confident that if you keep accurate records and have a good tax preparer, a small business owner can get through the process without too much fanfare.

The key for both business owners and individual filers is to learn from preparing your returns. For example, if a small business owner spends a lot on advertising, he or she might do some analyzing. Scrutinize those receipts and records to determine what worked best and what might be dropped to save money.

For individuals, taking a deep dive into your personal information can occasionally be enlightening. For example, many individuals are seeing higher interest earned on bank deposits and are consequently paying income taxes on the increase. In years past, such taxes were minimal because it was difficult to earn much interest. Last year, however, banks paid a decent rate, and the simple explanation is that higher interest rates translate into additional taxes.

On numerous occasions throughout the years, I’ve had people tell me they don’t pay any income tax. What that typically means is that they have withheld enough money from their paychecks so that they’re not required to send Uncle Sam any additional monies. They’re simply paying up front.

The reality is that whether your taxes are withheld from your paycheck or you send in quarterly estimates, you should know how much you’re paying. Is it $10,000 or $40,000? Whatever the number, you need to be aware of what you’re sending to Washington and Lansing. There’s an election coming up. Do you feel like you’re getting value for your tax dollars?

When looking ahead, make certain your current year’s objectives are being handled accurately. For example, was the increase in your retirement plan deduction implemented? Are the deposits accurately allocated to the funds you intended? And are they pre-tax or after-tax as you designated?

In other words, there are plenty of tax and financial statistics you can work on instead of watching the game. I would also like to suggest that Lions fans that were planning to go to Las Vegas should consider increasing their investments instead.

If you were going to spend $1,200 for airline tickets, $2,000 on hotels and meals and another $10,000 for a ticket, I suggest that you save or invest those “unspent” dollars. By doing so now, you’ll already have the money set aside and won’t have to go into debt next year. That’s when the Lions get over the hurdle and travel to the Big Game in New Orleans. Enjoy your trip!

The reality is that whether your taxes are withheld from your paycheck or you send in quarterly estimates, you should know how much you’re paying.

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