financial advisor speaking at conference
Financial Advisor, Financial Services, Insurance, Investing, life insurance, Personal Finance, Retirement

Financial Planning Resolutions for 2022

Now that we’re approaching the tail end of February, it’s not too early to assess the success of those New Year’s resolutions you made for 2022. Many of these have a familiar ring such as losing weight, spending more quality time with family or friends, or taking up a new hobby. While many people have already started to drift away from these good intentions by Valentine’s Day, there’s another resolution to which you can still dedicate yourself this year.

Getting into better financial shape is an important goal because it will bear fruit not only for the rest of this year but also for the ones that follow. Try these individual resolutions to improve your financial situation before the next new year rolls around.

Change Your Coffee Routine

Believe it or not, a fair number of articles on financial planning deal with how to cut coffee out of your daily routine. While you might be in denial about how many points you’ve accrued on that Starbucks card, you should look at how you spend your money on coffee instead of trying to eliminate it altogether. In order to cut back on your Starbucks outlay, try brewing your cup of joe at home or purchasing pre-brewed coffee from the store.

The bigger financial issue here isn’t expensive coffee. Instead, it’s about how to get rid of unnecessary expenditures. Whether it’s buying another soda or snack at the gas station on your way back to the pump, all of these items tend to add up.  Nevertheless, you can help both your waistline and your wallet by reducing your dependence on unhealthy and unnecessary snacks.

Take Account of Your Financial Security

Taking stock of your current financial well-being is a resolution that’s within reach for anyone. To accomplish this, look at how secure your income is and whether your current expenses will stay the same or not.

If expenses have been going up steadily, you need to ask yourself why. Are you charging more on your credit card than you used to? If so, what kinds of things have you spent your money on? Examining how much money is going out and whether it’s sustainable should give you an idea of how financially secure you are and if changes are in order.  

Formulate a Savings Plan

If you’ve already got a decent nest egg, it’s time to begin protecting it. Many people, for instance, invest in life insurance as part of their financial planning. Buying a life insurance policy can be a great way to safeguard your income.

Similar to a budget, creating a bona fide savings plan can put you on the right track towards a financially secure future. With the information gleaned from the step above, you can see how much money is left over after expenses that can go towards your savings plan.

Then you can set up automatic transfers to a high-yield savings account to grow your money without having to think about it. An effective savings plan is like having a road map to a better financial life. And it all starts with a plan to put aside a portion of the money you are earning right now.

Consult a Financial Services Professional

Meeting with an experienced financial services professional is another goal that you can achieve right away. An experienced financial advisor can look at your situation objectively and recommend the best options for your current situation and how to guarantee a comfortable retirement.

You could also speak with a licensed tax professional to get help saving money on your taxes this year. Financial services professionals are a terrific resource because their job revolves around improving people’s financial well-being.

Resolve to Stick with the Plan

Last but certainly not least, you need to adhere to the plans you’ve made. Persistence is the main reason that people become financially secure. The key is to develop a strategy that works and stick with it for the long haul. Furthermore, making these habits a normal part of your daily life will help you develop your financial literacy.

By following these individual resolutions, you will naturally achieve your overall goal of greater financial health for this year and the years to follow.

Young couple meeting financial advisor about investments
Financial Advisor, Financial Services, Investing, Personal Finance, Retirement

Is Combining Investments the Right Idea When Getting Married?

Getting married involves more than its fair share of decision making. One of the biggest of these decisions revolves around how you and your spouse will manage the money you’ve each been investing by yourselves over the years. For many couples, their natural inclination is just to combine their investments since they’re already combining the rest of their lives.

However, there seems to be a range of opinions among financial services professionals. Some encourage the idea of putting investments together and having a bigger portfolio balance to work with. On the other hand, other financial planners recommend that spouses keep their investment accounts separate. In every case, couples need to be open and honest with each other about their finances and their goals before making such an important decision.

Women in the Workforce

Data from the U.S. Bureau of Labor Statistics shows that 961,000 women returned to the workforce between Dec. 2020 and Dec. 2021 compared to 666,000 men. Moreover, women’s share of the workforce has been on a steady increase over the past century from 20% in 1920 to about 47% in 2021, according to the Department of Labor. Now that more women have their own incomes, they’re also weighing in more on the issue of combining savings and retirement accounts with their spouses.

It used to be the case that couples put everything together after the wedding. However, the trend has shifted a bit over the last few years, especially since men are often not the sole providers. Women who are earning money rightly want a say in how their finances are managed.

Pros and Cons of Combining Investments

Clearly, there are pros and cons to this issue that need to be discussed if you’re hoping for a long and fruitful marriage. In fact, a survey of divorce financial analysts cited money issues as one of the top three causes of divorce among their clients.

Strengthening Your Portfolio and Your Marital Bond

Research from the University of Iowa found that couples who lived together and combined their assets usually had stronger relationships than couples who did not. Nevertheless, many couples are still hesitant because of the ever-present risk of divorce. This can be even more of a factor when couples marry later in life and have children they want to designate as beneficiaries.

But some people find that keeping everything separate keeps couples from having the kind of financial intimacy that comes from solving economic challenges together, which can also strengthen a marriage.

Building Trust

The bedrock of any relationship, trust, is often reflected in the way that people deal with money. If you share all your assets, it’s clear that you aren’t keeping another account that enables you to pay for things you wouldn’t want your spouse to know about.

In addition, maintaining separate finances goes against the idea of making a commitment to share your life with someone. In essence, it’s difficult to be fully committed to each other if you’re managing your finances separately.

When Keeping Things Separate Is the Smart Choice

If one partner has outstanding financial obligations like credit card or student loan debt, those bills should still be paid from a separate account after they get married. A new spouse shouldn’t have to incur the existing debt that the other spouse brings to the marriage.

Although managing some expenses separately will entail strong communication between partners, the same couple can switch to a joint approach after their finances become more settled.

Merging Finances Makes It Less Complicated

Paying bills and putting financial investments in one basket makes couples more aware of their financial situation. You don’t have to stress over which account to use for your mortgage or property tax payments when there’s only one place to draw from. And you’re less likely to miss a payment too. It keeps things simpler. Furthermore, it helps couples have a better understanding of their financial well-being and what they need to do to provide for their future.

Speak With a Financial Advisor to Map Out a Plan

One of the smartest things couples can do to get started on the right financial footing is to speak with an experienced financial advisor who can help them figure out their goals and the level of risk with which they are comfortable. A knowledgeable financial planner can guide couples along the right path to consolidating their finances and setting them up for future financial success. In the end, the best strategy is one that suits both partners and enables them to achieve financial stability and a comfortable retirement when the time comes.