This month we are starting discussions with our clients for 2022 planning. Part of this discussion is optimizing for this year. Many are on track to achieve their financial goals. Heading into the last quarter of the year, we want to review the details of their plan to support these goals.  

Here are a few questions to ask yourself:  

  • Am I contributing enough to my employer’s retirement plan to get the match? If your employer offers a 5% match, take it! This means that you also contribute 5% of your pay to the plan. This is compensation that is not part of your base pay. Some call it “free” money. I call it part of your overall compensation and your employer is expecting you to take it. 
  • Can I contribute more this year? Putting more money into your retirement plan now is much better than later. Why? Growth! Time is a huge factor when growing investments. 
  • Are my tax withholdings appropriate? If you’ve had significant changes this year – got married or divorced, had a kid, started a business – you may consider reviewing your withholdings or estimated tax payments. Use the Federal withholding calculator to help you determine withholdings on the year. A tax professional or financial planner can help with estimating your tax bill on the year too. 
  • Can I earn more from a higher-yield savings account for my emergency fund? I am fully aware that interest rates are low right now – great for financing, not great for savers. But, you can find rates that are stronger than others if you check around. Find your current rate and research others. Be sure to check the terms of the bank if a rate seems too good to be true. It could be a promotional rate that lasts for a limited period of time, or you need to maintain a minimum balance to keep the rate. 
  • Have I reviewed my budget for the last month? What upcoming holiday or travel expenses should I be planning for? Take time this week to look back at last month’s spending and determine what is fixed and recurring, variable, or pure discretionary. Consider using a Budgeting Platforms to help you track and forecast for upcoming one-time expenses.  

Optimizing your current situation will help you plan for 2022. With federal student loan payments resuming, and inflation rising, now is a great time to review these areas, optimize, and plan for next year.  

Kelly Luethje, CFP®, is Founder of Willow Planning Group, LLC. She provides financial education and guidance to help you live life on your terms. Kelly can usually be found on a mountain or by a lake working virtually with clients across the country across the country.