New Year, New Finances! - January 2024 Prudent Money Coach Tax and Money Tips

Photo by Eyestetix Studio on Unsplash

Happy New Year! I hope you had a great Christmas and holiday season with your family and friends.

Beginning of the year is when my website gets a lot of visits. It seems like many people are eager to improve their finances. Perhaps it’s time to do some financial tidying up. There are so many different areas such as day to day finance, insurance, debts, estate planning, investing, etc.

Here are a few tips for now.
1. If you received a raise, consider:
- increasing your giving, saving & investing, but
- keep the same standard of living (there may be increased cost of living due to inflation).

2. Track your spending, do a budget, continue tracking your spending. Investing more money with lower returns yields better results than investing little money with higher returns. See Preet Banerjee’s YouTube: 
https://youtu.be/ugLJm9fU1nw?si=0eAirpgi110_O_7U

3. If you have not done so, now is a good time to take inventory of all your finances. Make an emergency folder that contains your:
- bank accounts 
- credit cards
- debts, including mortgage 
- life, long-term disability and any insurance
- pension
You can also add other important information into your emergency folder such as your:
- Social Insurance Number
- health card number
- name and contact information of your lawyer, accountant, financial advisor and any other professionals you have.

4. Perhaps you already know that the 2024 TFSA contribution room is $7000. You can save your emergency fund there or invest it. Here is breaking it down into bite size pieces:
- You can set aside $26/day x 5 days/week x 52 weeks = $6760.
- Or you can set aside $125/week & put $500 at the beginning of the year. 
- If you would like to invest and have a lump sum, it’s better to invest it all at once. 
But first, ensure you have emergency funds. 
If you didn’t max out previous years’ contributions or if you withdrew your TFSA in previous years, you have more than $7000 to contribute. 

That’s all for January. Let’s take better care of our finances this year. A small improvement is better than none.

Have a great month! :)