Last week, the markets recovered their losses and set another all-time high. The jobs and unemployment data was weaker than expected, leading to hopes of President Biden’s stimulus package making it through Congress. GameStop continued its decline, down to about $60 from a high of $483.
As we approach tax season, and you’re gathering all your documents, now is a good time to make a balance sheet for yourself as well. First, make a list of your assets, everything you own. This includes bank accounts, retirement or other investment accounts, your house, cars. If you have a significant collection that is valuable, include that as well. Then, make a list of your liabilities, or everything you owe. On this list, include not just how much you still owe, but also note the interest rate and monthly payment. If your assets are bigger than your liabilities, you have a positive net worth. If you owe more than you own, it’s time to tackle that debt.
If you’re really feeling the urge to get organized, you can take next step and make a list of your expenses. Each payment you make, and how often you have to pay it – monthly, quarterly, annually. Think about how much you spend on other things, like haircuts, car maintenance, pet care. Figure out what you spend annually, and compare that to your take-home pay. If you are spending less than you make, you have the luxury of deciding how you want to spend that extra. You can just have it as spending money, to go out, buy things, enjoy yourself. You can also set aside some with each paycheck to fund bigger goals – travel, college, retirement.
If you find yourself spending more than you bring in, look at expenses you can cut. Can you live without cable? Find a cheaper place to live, or get a roommate?
This week’s action to take is to open a savings account or money market. You can do that at your local bank, or with an online bank. The trick is that you want it to be somewhere you don’t see every time you check your bank balance. That’s all you need to do this week.
If you want to learn more about all things financial, join us for some of February’s educational events. You can register for these, and find much more on our website at covingtonalsina.com, or visit our Facebook page to learn more.
Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Great Valley Advisor Group, a Registered Investment Advisor. CovingtonAlsina and Great Valley Advisor Group are separate entities from LPL Financial.
All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
The opinions voiced in this show are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which strategies or investment(s) may be appropriate for you, consult with your attorney, accountant, and financial advisor or tax advisor prior to investing.