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Time flies, and the end of the year will be here before you know it. Now’s the time to make a few smart money moves before 2020 comes to a close.
Here are five strategic steps you should take if you want to start 2021 strong.
1. Spend the Money in Your FSA: Don’t Let it Go to Waste
If you have a Flexible Spending Account through your employer as part of your health insurance plan, remember this key fact: The biggest drawback with an FSA is that you lose whatever money you don’t use up by the end of the year. You can pull money from your FSA to cover the cost of prescriptions, office visit copays, over-the-counter medical supplies, eyeglasses or contact lenses.
2. Start Investing This Year: Spend $1 to Own a Piece of Amazon, Google or Other Companies
The best time to start investing is now, not later. Don’t wait another year! Sure, the stock market can be volatile, but over time the value of your investments will go up.
You can start small, if you want. In fact, you can get started with as little as $1 with an app called Stash, which lets you be a part of something that’s normally exclusive to the richest of the rich — buying pieces of other companies for as little as $1. You can invest in pieces of well-known companies, such as Amazon, Google or Apple, for as little as $1. The best part? When these companies profit, so can you. Some companies even send you a check every quarter for your share of the profits, called dividends.
3. Contribute to Your HSA: Don’t Miss Out on Tax Deductions
If you don’t have an FSA, maybe you have an HSA, instead. That’s a Health Savings Account, and it’s also used to cover out-of-pocket medical expenses. The goal of an HSA is to help people offset the cost of high-deductible healthcare plans. They help make healthcare affordable for families who struggle under the burden of insurance premiums and deductibles that can run into the thousands of dollars.
An HSA has less of an urgent deadline because, unlike an FSA, whatever money you don’t use up this year rolls over into next year. However, keep in mind that any money you put into your HSA before the end of the year is tax-deductible, which could help lower your 2020 income tax bill.
4. Cancel One of Your Streaming Services
Quarantine has many of us subscribing to multiple streaming services. But you don’t need to carry them all into 2021. If you’re subscribing to Netflix, Amazon Prime, Disney Plus, Hulu and HBO, maybe it’s time to take an inventory of which subscriptions you’re actually using. Maybe it’s time to jettison at least one of them. And if you still have cable, maybe it’s time to finally cut the cord and save yourself some money by going with a few streaming service instead.
5. Contribute to Your IRA
Would you like to retire someday? Sure you would! If you have an individual retirement account (IRA) as part of your retirement savings portfolio, you’ll want to contribute as much as you’re able to it this year.
Culled From Newfinancemagazine
