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Organize Your 2022 Finance Picture Through A Fresh Lens

No matter where you happen to be in your financial health journey, investing the time and thought to document or reevaluate your existing goals, is time well spent.

Five Money Moves to Make in 2022

Working out more, prioritizing self-care, and spending less time on your devices are all great resolutions for 2022. While these require commitment every day, money goals can often be front-loaded with organization and then automated, so they happen in the background while you’re reading, working out, and spending time with friends and family. We’ve focused on five things you can do to get your finances in shape – and keep them healthy – in 2022.

Create a Budget

Budgets aren’t just about limiting what you spend. They are a great way to get a freeze-frame of your money journey that you can then update in real-time as you move forward. Either create a spreadsheet or download a popular app, whichever appeals to you. There are four key pieces to know:

  • After-tax income – make sure your paycheck reflects your true tax liability. If you don’t have enough withheld or are self-employed, you’ll need to be sure you are putting away enough to pay taxes

  • How much you are spending on recurring items, on fixed expenses like personal debt, rent, mortgage, food, utilities, and discretionary items, like eating out and other treats

  • Any big-ticket items that you will need to cover in the short-term

  • How much you are saving. Track this on both before-tax and after-tax dollars to hit a percentage that works for your long-term savings goals. Then automate it directly from your pay to your savings or investing accounts

Manage Your Debt

If you have high-interest debt, the first step is to get it paid off as soon as possible. Credit card debt isn’t tax-deductible, it pulls down your credit score, so it costs you more interest on other debt and costs you more out-of-pocket on everything you buy on credit. With rates poised to go up, this will only get worse.

Creating a plan that aggressively prioritizes paying off this debt is an excellent way to go. If you can’t pay it off in a short amount of time – six months or less – on your own, try working with a credit counselor that can help you consolidate balances or enter into agreements with credit card companies. This may hurt your credit score in the short term but fixing a credit spending problem will pay long-term benefits.

Review Your Taxes Are you maximizing your income by minimizing your taxes? This can come in many different forms, such as contributing as much as possible to tax-deferred retirement accounts, health savings accounts, flexible spending accounts, and 529 plans. These let you save while lowering your tax bill in the year you contribute.

Beyond that, after-tax investing in an IRA or investing in a deferred compensation plan or an employee stock purchase plan can help you save additional, tax-advantaged funds for retirement.

Head Off Risk

The first step is an emergency fund holding three-six months of salary. If you have an emergency fund, but your income and expenses have gone up, it’s time to reload it to keep pace with your life. The goal of the emergency fund isn’t just to cover a one-time expense. It’s to provide for you and your family if your income suddenly declines or stops for any reason. Check your insurance coverage. If you have a family, it’s time to have life insurance. Depending on your goals and what point you are at in your journey, usually, a term-life policy works well. It covers you for the years when you have a mortgage, and your kids are growing up and need education funding. By the time the policy ends, you should have entered a different period of life when you don’t have so much riding on your income. Term-life policies are generally affordable and easy to get.

If you have the option to purchase disability insurance through your workplace, or it’s offered as a benefit, you’re ahead of the game. Review your policy limits and consider upgrading them if necessary. If your workplace doesn’t offer it or you are self-employed, consider getting an individual policy.

Estate Planning is for Everyone, at Every Stage

Whether you are still accumulating or are retired, an estate plan is the collection of instruments that protects your family, outlines your wishes, and can ease the transition and provide a legacy. Start with the essential instruments – power of attorney, health care proxy or similar directive, and a will to direct the guardianship of minor or other children that will need ongoing care. Once those are in place, you can think through asset strategies, such as insurance or other tax-advantaged ways to pass on your estate.

The Bottom Line

Money resolutions have an advantage in that once you set them up, they have the potential to keep your finances in good shape throughout the year. Spending some time putting the basics in place gives you a good foundation to make resolutions that are easy to keep.


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The information contained herein is intended to be used for educational purposes only and is not exhaustive. Diversification and/or any strategy that may be discussed does not guarantee against investment losses but are intended to help manage risk and return. If applicable, historical discussions and/or opinions are not predictive of future events. The content is presented in good faith and has been drawn from sources believed to be reliable. The content is not intended to be legal, tax or financial advice. Please consult a legal, tax or financial professional for information specific to your individual situation. This content not reviewed by FINRA.

Basepoint Wealth, LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.


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