Make 2023 a productive year for your finances by reviewing your financial goals. This means taking stock of your investments, budget, debt and taxes. Here are six steps to get you started.
FINANCIAL GOALS • BUDGETING • INVESTING
6 Steps for Financial Health in 2023
1. Review your household budget
Jumpstart your new year with a financial check-in and map out an ideal budget for yourself. This will require a reevaluation of your average monthly income, fixed expenses, and variable costs – such as groceries or gas. Make sure that your budget matches your personal and financial goals in 2023 and look for ways to reduces expenses and increase savings, especially when considering big ticket items such as buying a house, saving for retirement or a child’s education.
2. Look to reduce debt
Debt can be a massive hinderance to long-term financial goals. Seek to reduce your debt as quickly as you can and look to consolidate debt wherever possible. When thinking about where to allocate capital, always “pay yourself first”. What this means is reducing high interest rate debt instead of putting money in savings or investments. This creates a snowball effect through a reduction in future interest payments and an increase in savings and investments.
3. Diversify your investments
This year has exposed significant gaps in the traditional 60/40 portfolio as stocks and bonds were both simultaneously in decline. As we face ongoing geopolitical uncertainty, inflation and public market volatility, consider whether increasing your allocation to private markets could be advantageous. These opportunities could both decrease the volatility of your portfolio while also increasing the likelihood of achieving your financial goals. This can include the addition of income opportunities in real estate, infrastructure and private debt. Citizen Mint helps advisors and individuals gain access to a curated list of institutionally vetted private market opportunities at low minimums.
4. Contribute to and leverage tax-advantaged accounts
Utilize an IRA, either Roth or Traditional, to invest excess capital to grow tax free until retirement. Contribution limit is $6,500 for 2023 and $7,500 for individuals over 50. Reducing tax drag can add thousands to your portfolio over time. For investments that generate regular payments, an IRA can help reduce higher ordinary income tax exposure through deferral of recognition.
5. Align your portfolio with your values
As we look ahead to 2023, it’s clear that investors want their investments to reflect the values they hold dear. Morgan Stanley’s Investor Pulse Poll reported 71% of all respondents feel this is important – but only 44% believe it currently happens. Citizen Mint is providing advisors the ability to align client portfolios with their values while seeking to maximize returns.
6. Examine where your cash is held
As a result of the Federal Reserve’s aggressive rate hiking spree, investors have significantly better options for storing cash heading into 2023. We have recently seen savings rates creep up to 4% and, in some cases like Primis Bank, even approach ~5%.
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*Financial projections or returns displayed on the website are estimated predictions of performance only, are hypothetical, are not based on actual investment results and are not guarantees of future results.
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Any financial projections or returns shown on the website are estimated predictions of performance only, are hypothetical, are not based on actual investment results and are not guarantees of future results. Estimated projections do not represent or guarantee the actual results of any transaction, and no representation is made that any transaction will, or is likely to, achieve results or profits similar to those shown. In addition, other financial metrics and calculations shown on the website (including amounts of principal and interest repaid) have not been independently verified or audited and may differ from the actual financial metrics and calculations for any investment, which are contained in the investors’ portfolios. Any investment information contained herein has been secured from sources that Citizen Mint believes are reliable, but we make no representations or warranties as to the accuracy of such information and accept no liability therefor.
Private placement investments are NOT bank deposits (and thus NOT insured by the FDIC or by any other federal governmental agency), are NOT guaranteed by Citizen Mint or any other party, and MAY lose value. Neither the Securities and Exchange Commission nor any federal or state securities commission or regulatory authority has recommended or approved any investment or the accuracy or completeness of any of the information or materials provided by or through the website. Investors must be able to afford the loss of their entire investment.
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