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8 Must-Do Financial Resolutions for 2022

Now is the time for retirees (and those thinking about retirement) to optimize their finances for 2022. Here's a step-by-step guide from a leading financial planner.

By Katelyn E. Murray, CFP

What financial, business, or life priorities do you need to address in the new year? Now is the perfect time to optimize your personal finances for 2022 and beyond. Here are some ideas on how to get started:

Katelyn Murray

Katelyn Murray

  • Review your financial plan. New Year’s is a great time to review your financial plan to ensure that it is still reflects your personal goals. A financial plan is a living document, and as such, it should be revisited and adjusted regularly. Having a plan in place will make it easier for you to track your progress throughout the year and will help you set specific short- and long-term goals and develop clear strategies on how to achieve those goals. Don’t have a financial plan yet? We can help with that! 
  • Create a spending plan. Notice I used the term “spending plan” there—not “budget.” Budgets often feel restrictive, complicated, and rigid. For this reason, most people don’t enjoy the process of “budgeting.” Instead, create a spending plan to use as a roadmap for how you’ll spend your money, focusing on paying yourself first, i.e., treating contributions to your savings goals and retirement accounts like any other household bill. Once you’ve worked out how much of your income you’ll use to “pay yourself” and how much to direct to non-discretionary expenses like housing and utilities, you can feel empowered to freely spend the rest on whatever you like! This approach of putting your money to work for you is quite effective at helping you spend mindfully without it feeling overly restricting. 
  • Double check your contribution to your retirement plan at work. Periodically, the IRS increases the maximum allowable annual contribution to employer retirement plans, so New Year’s is a great time to double check that you’re making the most of your plan through work. For 2022, the 401(k) contribution limit has been increased to $20,500 (the catch-up contribution for those over age 50 remains the same for this year, at $6,500). 
  • Did you forget to fund your IRA or HSA in 2021? Don’t panic—there’s still time! You have until April 15, 2022 to make a “prior year” contribution to a traditional IRA, Roth IRA, or health savings account (HSA) for 2021. You can stash away up to $6,000 in an IRA for 2021 ($7,000 for those over age 50). The 2021 HSA contribution limit is $3,600 for single coverage or $7,200 for family coverage (plus an extra $1,000 if you’re over age 55). If you’ve already fully funded these accounts for last year, consider going ahead and checking this year’s contribution off the list. 
  • Spend down your FSA. If your employer offers a grace period to use up flexible spending account (FSA) funds from the 2021 plan year, that grace period expires on March 15th. Check out the list of eligible medical expenses at: https://fsastore.com/fsa-eligibility-list.aspx 
  • Check on your credit report. You can get a free copy of your credit report from www.annualcreditreport.com. You can also regularly monitor new activity and alerts on your credit through Credit Karma. They also provide helpful tips for building credit, but they’re funded by affiliate links for credit card companies, so beware! 
  • Review your insurance policies to make sure you aren’t over- or under-insured. Review all your policies—homeowner's, auto, disability, life, and long-term care insurance. Are the limits adequate? Should the deductibles be raised? Is there a less expensive policy with similar coverage? Are you taking advantage of all the discounts offered to you by your insurance providers? Websites such as www.insurance.com and www.policygenius.com provide quotes from several insurers so you can compare and find the best coverage for the best price. 
  • Hire a fee-only fiduciary advisor. In our increasingly complex world, if you are struggling with questions regarding your current or future financial situation you are not alone. Having a knowledgeable advisor on call to help you navigate financial decisions helps you build confidence in your financial plan and empowers you to spend money on the things that truly enrich your life. Trust—like wealth—takes time to build. Get started today and make 2022 the first of many great years to come!

About the Author: Katelyn E. Murray, CFP®

Katelyn E. Murray, CFP®, is a fee-only, fiduciary financial planner and behavioral coach with nearly a decade of experience helping clients define their own vision of success and build a reliable path to reach it. Katelyn uses her background in financial psychology and behavioral finance to cultivate an integrated financial planning approach, in which behavioral coaching elements are integrated with traditional planning and wealth management expertise. As a public speaker, she has appeared as a guest on The W Pulse podcast and has been invited to speak at a number of industry conferences nationwide, including Advisor Group’s ConnectED conference and The W Forum.