January 2025
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J
anuary marks the official beginning of the 2024 tax filing season. Informational tax returns will start pouring in, so too will the bad players trying to take advantage of the unwary taxpayer. So be on the alert for possible tax identity theft. Now is the time these bad players are most active.
This month’s focus is on the new year. Traditionally a time for new year’s resolutions, each article chosen is a different angle on approaching the new year. Whether it is getting prepared for the upcoming filing season, or a new year review of your retirement savings
plan, now is a great time for review and goal setting. There is even an article on suggestions to help prepare the financial future of young loved ones and a list of areas that could use an annual check up. Enjoy!
CREATING A FINANCIALLY SAVVY FAMILY
As part of our new year issue, why not include some ideas to help those around us set themselves up for a great financial future. This article focuses on ideas to help create financial savvy children and grandchildren. It’s never too late to impart your wisdom. Here are some age-relevant suggestions to help develop a solid financial IQ:
• Preschool – Start by using dollar bills and coins to
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teach what the value of each is worth. Even if you don’t get into the exact values, explain that a quarter is worth more than a dime and a dollar is worth more than a quarter. From there, explain that buying things at the store comes down to a choice based on how much money you have (you can’t buy every toy you see!). Also, get a piggy bank to start saving coins and small bills. • Grade school – Consider starting an allowance and developing a simple spending plan. Teach them how to read price tags and do comparison shopping. Open a savings account to replace the piggy bank and teach them about interest and the importance of regular saving. Have them participate in family financial discussions about major purchases, vacations and other simple money decisions. • Middle school – It is time to connect work with earning money. Start with activities such as babysitting, mowing lawns or walking dogs. Open a checking account and transition the simple spending plan into a budget to save funds for larger purchases. If you have not already done so, now is a good time to introduce the importance of donating money to a charitable organization or church. • High school – Introduce the concept of net worth. Help them build their own by identifying their assets and their current and potential liabilities. Work with them to
January 15 4th quarter installment of 2024 estimated income tax is due for individuals January 20 - Martin Luther King Jr. Day
get a part-time job to start building work experience, or to continue growing a business by marketing for more clients. Add additional expense responsibility by transferring direct accountability for things like gas, lunches and the cost of going out with friends. Introduce investing by explaining stocks, mutual funds, CDs and IRAs. Talk about financial mistakes and how to deal with them when they happen by using some of your real-life examples. If college is the goal after high school, include them in the financial planning decisions. Tie each of these discussions into how it impacts their net worth. • College – Massive debt often occurs during this period. So focus leaning on borrowing money and all its future implications. Explain how credit cards can be a good companion to a budget, but warn about the dangers of mismanagement and not paying the bill in full each month. Discuss the importance of their credit score and how it affects future plans like renting or buying a house. Talk about retirement savings and the importance of building their retirement account. Knowing about money — how to earn it, use it, invest it and share it — is a valuable life skill. Simply talking with your children about its importance is often not enough. Find simple, age-specific ways to build their financial IQ. A financially savvy child will hopefully lead to a financially wise adult.
Begin tax filing for 2024 - Organize tax documents (W-2s, 1099s, 1098s and other records) - Schedule tax appointment for document drop off or meeting
Begin tax planning for 2025 - Create a budget - Adjust your withholdings - Rebalance investment portfolios