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One money move at a time, short enough to read in two minutes. Pick one and act on it today.
Over 30 years, half a point off your mortgage rate can save more than a $10,000 price cut. The longer you’ll keep the loan, the more the rate matters, so negotiate it as hard as the price. Raise your credit score before you apply, get quotes from several lenders, and ask each one to beat the best offer.
Hire your own home inspector before closing, even if the seller offers a report or a hot market tempts you to skip it. Keep the inspection contingency in your offer. Until it expires, it lets you renegotiate or walk away with your deposit if the inspector finds a problem.
Your 401(k) contribution limit starts over on January 1, and any room you don’t use by your last December paycheck is gone for good. Each January, look up the new IRS limit, divide it by your number of paychecks, and set your contribution to that amount if your budget allows.
For parents, a will is less about money than about people. It’s where you name who would raise your children and who would manage anything they inherit. If anyone depends on you, write a will this month, however little you own.
For most families, life insurance does one job, replacing your income while others depend on it. Term life covers those years for a small fraction of what whole life charges for the same death benefit. Buy a term policy that runs until your kids are grown or the mortgage is paid, and invest what you save.
Sell a losing investment in a taxable account, and the loss cancels gains you’ve taken, while up to $3,000 a year beyond that ($1,500 if filing separately) comes off ordinary income. Reinvest in something similar but not substantially identical, and don’t buy the same investment for 30 days on either side of the sale.
Claiming Social Security at 70 instead of 62 makes your monthly check about 77% larger if your full retirement age is 67. If you’re healthy and can cover the gap from savings, delay your claim. The larger checks make up for the missed years by about age 80, and they rise with inflation for life.
Required minimum distributions (RMDs) stack on top of Social Security and any pension. The share you must withdraw rises every year, so a big traditional IRA or 401(k) can move you up a tax bracket in your 70s. Use the lower-income years before your first RMD to draw it down at lower rates.
A health savings account lets your money skip federal tax going in, growing, and coming out when you spend it on medical care. If your health plan qualifies, fund it every year, invest the balance, and pay small medical bills out of pocket so the account keeps compounding.
Once your net self-employment earnings reach $400 a year, you owe a 15.3% tax for Social Security and Medicare in addition to income tax, and no employer withholds it. Set aside part of every payment and send it to the IRS each quarter, or have extra withheld from a W-2 job, so April never brings a bill you can’t cover.
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