News
Jill On Money: Summer Financial Tasks
The stock market is up, inflation is down and everything is fine, right?
Maybe, or maybe it’s summer and you don’t feel like taking care of your finances. Not so fast… just a little focus can help you save or earn some money before the next Heat Dome arrives.
Here are some items for your summer financial to-do list:
Review subscriptions
You signed up to Brit Box to watch an absurd amount of British crime dramas (who, me?)
Or maybe you want to read an article or two from some intellectual site that automatically charges a fee after the 7-day free trial.
It’s time to cancel unwanted subscriptions, once and for all. You can do this by scanning your automatic subscriptions in Apple Pay or Google Pay and also checking your credit card statement.
Take advantage of higher interest rates
The Fed has kept short-term interest rates at a 23-year high for nearly two years, but many savers are still making a pittance on their safe cash.
Before the Fed starts cutting, check out high-yield savings accounts, money markets, or certificates of deposit. You could earn 4 or 5 percent on your emergency fund, money for future tax payments, or a tuition bill that’s coming up in the future.
Real estate and car insurance store
The cost of home and car insurance has skyrocketed over the past five years. To offset some of the increase, do your research, consider bundling coverages, find out about ways to qualify for a discount (security systems, paying for a full year instead of monthly, taking a defensive driving course), and consider dropping coverages collision and/or comprehensive coverage on older cars.
According to the Insurance Information Institute, “if your car is worth less than 10 times the premium, purchasing coverage may not be cost-effective.” Look up your car’s value in Kelley’s Blue Book.
Clear investment accounts
The job market may be slowing, but there are still plenty of workers changing jobs — and those people are leaving a lot of bills in their wake.
Simplify your retirement savings by combining all similar accounts (i.e. all Roth’s, all traditional) in one place. If you have an affordable workplace plan, you may be able to transfer old accounts; otherwise, choose a financial institution that is easier for you to navigate and deposit money into.
Combining accounts makes it easier to monitor your entire portfolio, ensures your money is properly diversified, and lets you see if you can ditch expensive managed mutual funds in favor of cheaper index funds.
Increase retirement contributions
Has your cash flow improved this year? If so, it’s time to add to your retirement account. The 2024 limit for contributions to work-based retirement plans (401(k), 403(b), 457) is $23,000 (catch-up contributions for those over 50 remain at $7,500). The IRA limit is $7,000, and the catch-up for those over 50 remains at $1,000.)
Starting or completing estate planning
If you need more than a little nudge from Aunt Jill to prepare your will, power of attorney, and health care proxy, read Jonathan Clements’ recent post on Humble Dollar, The C-Word.
In this heartbreaking column, Clements reminds us that “We can control risk, but we cannot eliminate it… I have spent decades managing both financial risk and potential threats to my health. But despite these precautions, we are sometimes caught off guard… Chance is a cruel mistress.”
Indeed, it is, so let’s not wait for a dire diagnosis to ensure that our wishes are fulfilled and that our heirs can spend their time grieving rather than cleaning up a messy estate.
Jill Schlesinger, CFP, is a business analyst for CBS News. A former options trader and CIO of an investment advisory firm, she welcomes comments and questions at askjill@jillonmoney.com. Check out her website at www.jillonmoney.com.