12 Days of Money Tips
I drove 17 hours from Georgia to upstate New York yesterday in sleet and among America’s worst drivers, so as you can imagine, I’m just flying high on Christmas spirit right now. Before I raid my parents’ liquor cabinet, I wanted to leave you with some holiday wisdom which I’m calling “12 Days of Money Tips”. It’s my gift to you. What are you getting me? Hamilton tickets are still at the top of my list.
1. On the first day of Christmas, Catie is telling you: start saving for emergencies NOW. Do it now. We’ve discussed emergency savings in a previous post and I think if you’re at the beginning stages of getting your financial life together, this is a good place to start. Figure out what 3-6 months of living expenses would cost you, and aim to save that amount.
2. On the second day of Christmas, Catie is telling you: Contribute enough to your employer-sponsored retirement plan to receive your company match. If you don’t contribute enough to receive your company’s match, you are literally leaving free money on the table.
3. On the third day of Christmas, Catie is telling you: pay off that credit card in full each month (ifyou can). If you cannot pay off the full balance, work your butt off to get rid of that credit card debt as soon as humanly possible.
4. On the fourth day of Christmas, Catie is telling you: Don’t buy a house until you’ve saved 20% for a down payment. What’s the rush, you guys? Houses are the single largest purchase you will make in your life. Make sure you aren’t making a decision you can’t yet afford.
5. On the fifth day of Christmas, Catie is telling you: If a dependent relies on your income, you damn well better have some term life insurance. No, you don’t need an expensive whole life policy. A simple term policy to cover your dependents should something tragic happen to you is so important. The policy only has to cover the kids until the kids are old enough and "off the payroll" as my Dad would say.
6. On the sixth day of Christmas, Catie is telling you: Read one personal finance book this year. Ignorance is not a virtue, read a damn book and educate yourself. Sorry, that was harsh, but I’m over the meme loving, clickbait clicking, non-reading America. Education and compassion are the answers to most of our individual and collective problems, but then again, 2017 might be a good year to bury our heads even deeper in the sand.
7. On the seventh day of Christmas, Catie is telling you: plan for your taxes before the end of each year. You may be able minimize your tax bill. You may be able to anticipate your tax bill and budget money appropriately beforehand.
8. On the eighth day of Christmas, Catie is telling you: diversify, diversify, diversify. Don’t put all your eggs in one basket. Proper asset allocation is crucial to reaching your financial goals. A financial planner can help tell you if you are properly diversified.
9. On the ninth day of Christmas, Catie is telling you: Review your company benefits. You may be missing out on some sweet benefits, or over paying for others. Do a review of your company benefits package.
10. On the tenth day of Christmas, Catie is telling you: Get your spending under control. Download a cash management/budgeting app to help you. Living below your means now will help you accomplish your goals faster and live like a badass later.
11. On the eleventh day of Christmas, Catie is telling you: Use your year end bonus wisely. I recommend spending 10% of the bonus on something fun, and apply the rest toward reaching your financial goals. As tempting as it may be to blow your entire bonus, you’d be best served to apply 90% of the bonus to paying off debt or saving toward a goal.
12. On the twelfth day of Christmas, Catie is telling you: Saving for your future needed to start yesterday. If not, start today. It’s better to save a little bit than nothing at all either.
Finally, I thank you all for reading my weekly money ramblings. I truly hope they are inspiring you to take control of your financial life. I wish you all a very happy and healthy holiday. Except the woman in the Geo Tracker adorned with a Rudolph nose and antlers who clogged up the left lane of I-81 yesterday. I wish you a lifetime of coal.