4 financial moves to make before the year ends

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4 financial moves to make before the year ends

 4 financial moves to make before the year ends
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Highlights 

  • At the end of a year, people generally review their financial performance of the past 12 months.
  • They do so to learn from their mistakes and enter the new year in the best possible financial position.
  • They also want to take the maximum benefit out of a few investments and tax strategies that could become more expensive next year.

It is that time of the year when people sit down and review their financial performance of the past 12 months. At the year’s end, people discard old moves and make new ones so that they can enter the new year in the best possible financial position.

People also draft new strategies so that they can take maximum advantage out of a few investment and tax strategies that could become more expensive from next year. Just like every time, people this year too would take the onus on themselves or approach financial advisors, retirement consultants and tax experts to start 2022 on a bright note.

Here are four financial moves to make before the year ends

Personal budget spreadsheets

It is always handy to have a personal budget spreadsheet to plan ahead. You can have a look at it to recollect where and when did you spend in the last year and how much was actually needed. You can also plan ahead for what is expected to happen next year.

In addition, you can start with sinking funds. These help to calculate the amount required in coming days. You can divide that amount by how many paydays until the expense is to be paid for.

Be cautious with credit card debt

Credit card loans can easily trap you for years and there is no easy escape from it. You can easily review your credit card loans either by looking at your credit card bills from the last 12 months or allocation towards the same from monthly earnings mentioned on the budget spreadsheet.

The best you can do from next year is to completely repay the credit card debt for once and all. You can start making extra monthly payments to repay the debt. Generally, the borrowers are seen to be in the habit of monthly billing cycles. However, there is no such requirement to wait to pay until the payment due date.

Review of health insurance plan

Considering the increasing cases of Omicron, the year 2022 is expected to keep people on tenterhooks. The economic uncertainty is not likely to fade away soon. In such a scenario, the role of health insurance plans increases manifold since hospitalisation rates have suddenly spiked, draining people of savings. So, you must review your current health insurance plan and carry out necessary changes.

Reading personal finance books

There is nothing better than educating yourself about money. It not only helps to change one’s mindset towards financial aspects of life but also improves life in general. You can start off 2022 with new knowledge about how to manage your finances and what to do with your money. Some of the widely followed personal financial books include Rich Dad, Poor Dad, How to be good with money, The Intelligent Investor, and Mindful Money The Book.

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