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Chances are your paycheck grew a little in February. That’s
due to the 2017 tax reform legislation that took effect earlier this year. This
reform lowered tax rates and changed income thresholds for most working people.
A lower tax rate means less money withheld from your paycheck and more take-home
pay.
It’s easy to see that money in your check and make big plans
to spend it. But there’s probably a better way to budget that money. The small
steps you take with this money can help create big plans in the future.
One step you can take is increasing your contributions to
your 401(k) or other retirement savings accounts. If you want to make sure
you’re saving enough, there are plenty of resources available to help you plan
for retirement. For example, National Retirement Planning Week runs from April
9-13 with events nationwide to help consumers focus on saving for retirement.
Visit their website for
details and events.
Another step to a secure future is ensuring you have an
emergency savings fund. According to data from the Federal
Reserve, 44 percent of adults say they could not cover a $400 financial emergency
without having to borrow money or sell something. Starting a savings account
now will put you in a better position for handling future emergencies. One tip:
Deposit money into an account that can’t be easily touched so you’re not
tempted to spend that money on non-emergency expenses.
If your take-home pay increased due to the
recent tax reform legislation, find a way to make that money work for you. It’s
easier to put this money aside since you haven’t been using it for living
expenses. For assistance on your own financial situation, seek advice from a
reputable tax advisor to help you save for your retirement.
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