The 2017 Tax Cuts and Jobs Act (TCJA) was a sweeping piece of legislation that changed many things most business owners had become accustomed to. While there are many new provisions enacted and old ones that have gone away, there is one in particular that started an onslaught of chatter amongst tax professionals and business owners alike…
Budget
You may want to set a budget to stick as close as possible to expected spending limits. Start by recording current spending in these areas, and then agree on the amounts you want to spend in the future.
Rent or mortgage payment
Utilities, including electric, gas, water, garbage, phone, internet, cable
Food and supplies, including grocery, kitchen items, liquor, and eating out
Entertainment, including travel, vacations, local events, holiday decorations, Netflix subscriptions, tech gadgets, books, etc.
House maintenance including repairs, cleaning, lawn care, appliances, and decorating
Automobile, including gas, insurance, licenses, and maintenance
Clothing and accessories, including dry cleaning
Health care, including pharmacy, doctor’s visit, and HSA contributions
Personal care, such as haircuts, nail care, etc.
Tuition and/or education expenses
Contribution to retirement and savings accounts
Charitable contributions
Taxes, including federal, state, local, school, and property
Paying down credit card or student loan debt
Retirement
What does retirement look like to both of you? Having this conversation will be enlightening. Know that dreams and goals will change over time and as retirement approaches.
You’ll want to have an idea about what you’d like to spend during your final years so that you can make plans to start accumulating that wealth now. The sooner you start, the more years you have to build up your retirement assets.
Monitoring your progress
Keep an eye on your account balances to make sure everything is as it should be. Review bank and brokerage account statements and/or your budget once a month or at least once a quarter so there are no surprises or trends that sneak up on you.
When you reach your goals, reward yourself. Managing money is hard work, and you deserve to acknowledge and celebrate your achievement. If there is anything we can do to help make your financial dreams come true, please reach out any time.
