1. Check your retirement account.
If you opened a retirement account in 2021, it's time to check-in.
Have you met your contribution requirements? If not, see if you can make some room in your budget to set aside money for your retirement. If you missed the start of 2021, you have a little bit of time to catch up on the contributions you should have made. That's right, you can retroactively contribute to a retirement account for up to six months. If you are 50 or older you can also make catch-up contributions to your 401( k) that can total an additional $ 6,000 in 2022. Those are two of the very best ways to make your money work harder for you in the year ahead.
2. Pay down debt.
The average American has $6,741 in credit card debt, according to a survey by the National Financial Services Investor Council. That's a debt you certainly don't want to have when you retire.
If you have any debt that has a high-interest rate, it's time to focus on paying that down. You'll save money on interest and have one less bill to pay each month.
If you're not sure where to start, look at the debt with the highest interest rate first. And if you have a good chunk of cash saved, consider using that to pay down debt, too.
3. Start a side hustle.
If you're really strapped for cash, you can always use a side job to boost your income. And while you might think the idea of a side hustle sounds fun, it's not always easy.
But if you're willing to put in the work, you can make some serious money. In fact, you can make up to $500 a week working from home, according to FlexJobs, a jobs board for telecommuting and flexible schedules.
Even if you can't make that much, you can still pick up a few hundred dollars a month. And if you do that for a year, you'll have an extra $1,200 for retirement or paying down debt.
4. Open a Roth IRA.
Are you maxing out your retirement accounts? If not, open a Roth IRA. You can contribute up to $6,000 to a Roth IRA in 2022, or $7,000 if you're 50 or older. And because you pay taxes on your contributions now, you won't have to worry about it when you're retired.
5. Check your insurance.
In 2021, health insurance premiums rose 9.1%, which was the biggest jump in nearly a decade. In fact, the American Academy of Actuaries predicts that health insurance premiums will rise 8.5% in 2022. That's an increase of 2. 6 percentage points more than the academy predicted in 2021. If you have a flexible spending account (FSA ), use it to the max.
It's a great way to save on health care costs. And if you have kids under the age of 19, you can also set aside up to $5,000 in money for their college expenses tax-free in a 529 account.
Those are the top 5 money moves you should make in 2022, but there are many more. Check out our complete list of money moves to make in 2022. Making these moves will help you get your debt paid off, save more, and make your money work harder. It won't happen in one day, but it will happen if you make these moves a priority. And that's what you should do for your money in 2022.
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