7 Money Moves To Make in 2022 For Pre-Retirees #78

Jan 5

If you’re looking to retire in the next few years, this episode is for you. As we move into 2022 you can start your year right and get your retirement plan in order by doing a handful of simple “money moves” to ensure you’re on the right track. This is a rapid-fire, easy-to-follow episode so get out your pencil and paper and take some notes. We’ll cover reviewing your budget, paying down high-interest debt, increase contributions to your retirement plans, review your asset allocation, create an emergency fund, review life insurance coverages, and review or update your estate planning documents. It’s all on this episode.

You will want to hear this episode if you are interested in...

[0:56] Review your budget: How did you spend your funds in 2021?
[2:20] Start to pay down your high-interest debt
[4:30] Increase your contributions to your retirement plans
[6:00] Review your asset allocation
[8:09] Create an emergency fund
[9:39] Review your life insurance coverage
[11:01] Review your estate planning documents

2022 money move recommendation #2: Pay down high-interest debt

This could be holiday spending debt, or debt you’ve had for a while. High-interest debit is problematic especially as you near retirement. I personally like to address the highest interest debt first and begin making extra payments to it. As you pay off that debt, you then move your payment to the next debt in line. Some other options to help you accelerate your debt payoff are:

You could consider refinancing your home if the interest rate you currently have is high, but be sure you calculate if it’s worth the process to incur closing costs and fees required to refinance. You could also take out a home equity line of credit, which will have a variable interest rate after a year or so, but it likely won’t be as high as your credit card rate.

Money move #7: Review your estate planning documents

Reviewing your estate planning documents is easy to put off, it’s like cleaning out the garage or the attic — you know you need to do it but it never seems to get done. If I may, can I encourage you to bump this up on your priority list? It’s very important. If you don’t have an estate plan and pass away, the disposal of your estate may not go as you wish which could make things very difficult for your beneficiaries and family. But you can do some simple things and avoid all that. What are those things?

Make sure you have a Will. Then ensure you have beneficiaries named on all of your retirement, investment, and annuity accounts. For non-retirement accounts, make sure you set them up as “transfer on death” accounts or with joint tenancy so someone else can access the account if you are unable. Also, consider setting up both healthcare and financial power of attorney.

Listen to hear all the money moves I recommend for 2022.