Top Tips for Financial Planning for 2021 is a must-read. It’s fair to say that the year 2020 has been a tough one. We’re not even sure that rough covers it.
This year may have been not so great, but that doesn’t mean the same trend has to extend into 2021. You can make 2021 your best financial year yet, with some preparation and some hope. Here are some pointers and suggestions.
Top Tips for Financial Planning for 2021
Invest in Yourself
One of the factors that may have changed the most in 2020 may have been the job market.
We found that jobs fell into four different groups during this pandemic. We’ve got people who:
- Are still employed as usual
- That are still working, but they work from home now.
- That were furloughed or laid off, but were able to find another job,
- That have been furloughed or laid off and are yet to find another job.
The silver lining of this year is that people are beginning to think about and reconsider where they are in life at the moment. That means that there is no better time than now to invest in yourself.
Investing in yourself is like financially investing. The best time to start was yesterday, but right now is the second-best time to start. The best thing is that it does not have to cost you money to invest in yourself. Some things just cost a little time.
Taking an online class to acquire a new skill will make you more marketable for a future promotion or new work, depending on your objectives.
To learn some new financial skills, such as budgeting or saving, you should spend a bit of money buying some books or budgeting softwares. For some inspiration, listen to some TED talks. You can find channels on YouTube to help you get fit or stay fit. To invest in yourself in 2021, decide what you want to do and then go for it.
Top Tips for Financial Planning for 2021
Start a Budget—But Not Just Any Old Budget
Budgeting is the root system of your financial tree. Maybe you always mean to make one but never quite get around to it. That was certainly the case for many and the early days of the COVID-19 showed them why that was a bad idea, as they found themselves short on cash and without an emergency fund.
There are lots of ways to budget, and some work better for people than others. The most important thing is that you find one that works for you and stick to it, even if it is just a list of expenses and outgoings in a notebook rather than a formal software setup.
Top Tips for Financial Planning for 2021
Start Investing
There are a lot of people that tend to shy away from investing because of fear or lack of knowledge in ‘normal times’ so they certainly do not want to consider it in pandemic or post pandemic times.
The stock market has been up and down throughout 2020, and that may continue in 2021. However, investing is one of the best ways to plan for your financial future, especially your retirement. You do not have to dive headlong into the stock market, there are other ways to invest. The best idea? Schedule a meeting with one of our independent financial advisors and let them help you formulate an investment plan for 2021 and beyond.
Top Tips for Financial Planning for 2021
Keep Investing
If you already invest in some way 2021 is not the time to change that. Because of the volatility of the markets you may need to reset some of your plans in 2021 though.
In the three types of large asset categories: stocks, bonds, and cash or other securities, find out how much you have in taxable and retirement accounts combined (be sure to consider the accounts of your spouse, too, if you are married). If you buy a target date fund or some other fund that invests in a combination of stocks and bonds, to get a rundown of how much it holds in stocks, bonds, and cash, you will have to look at the most recent fund report.
Calculate the percentages of each compared to your entire portfolio until you have totaled your assets in each of the three asset groups. You might need to reset your portfolio, depending on your results. Meet with your financial advisor to discuss the best course of action for 2021.
Money Making and Saving in 2020