Keeping Your Finances On Track In The New Year

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Keeping Your Finances On Track In The New Year


Spending as little as 30 minutes per week on your personal finances will save you thousands of dollars per year. 

Over a lifetime, this basic financial housekeeping could help you save millions. Seriously!

But what kinds of things should you be doing each week? With tax deadlines, employer forms, auto insurance, and other financial responsibilities banging around in your head, it can feel stressful and confusing to know what to focus on and when. 

That’s why I did my best to plan everything out for you. Below is a thorough list of dates in 2021 of when you should focus on which specific things. I tried to keep everything separated so you never feel overwhelmed, and offer tools and resources to expedite each step of the process.

In short, follow this calendar and you’ll be fiscally-savvy in no time!

January

2021 Personal Finance Calendar: Keeping Your Finances On Track In The New Year - January

In January, you’ll kick the year off by starting a simple budget and setting some goals!

January 4th: create a 2021 budget

If you haven’t already, the week after New Year’s is the perfect time to make a 2021 budget

Now, creating a budget doesn’t have to mean sitting down with a massive spreadsheet and itemizing everything you’ll ever spend money on (though I know friends who enjoy doing this). Creating a budget can be as simple as spending five minutes with a simple budget worksheet to get a ballpark idea of how much you can spend on certain things each month. Having even the slightest budget in mind can help you save hundreds per month

To help you stay within budget, you can also download a budgeting appFor example, PocketSmith is like a totally free financial assistant to help you reign in spending and keep an eye on personal trends.

January 11th: check your credit score and set goals

Your credit score is an important number to keep an eye on since it dictates your ability to receive loans of all types (auto, mortgage, etc.) and how favorable those terms will be. 

For example, if you have OK credit (560) a lender might offer you a 6% APR on an auto loan. But if you can bump up your credit to excellent (700+) before buying a new car, you can lower your APR to as little as 3%, saving thousands over the course of the loan. 

January 18th: review your credit cards

January is also a good month to review your credit card situation, since opening the right cards could earn you hundreds of dollars in opening bonuses, give you points on the right things, and improve your credit over time

I strongly recommend avoiding “lifestyle cards” that offer cash back on nonessentials like luxury goods and travel. Unless you’re already spending gobs on those categories, you shouldn’t open a credit card that encourages unnecessary spending or “retail therapy.” 

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Instead, consider a card like the Chase Freedom Flex℠, which offers 5% cash back on groceries (on up to $12,000 spent in the first year) and 3% on dining and drugstore purchases. Talk about essentials! The card also comes with a $200 opening bonus after you spend $500, an additional 5% on up to $1,500 in combined purchases in bonus categories each quarter you activate, and 1% cash back on all other purchases.

Finally, if you’re planning a big purchase in 2021, the Chase Freedom Flex℠ offers a 0% Intro APR on Purchases for 15 months

January 4th: adjust your W-4

When you get a job, one of the first of many forms you’ll fill out is the W-4. 

The W-4 helps to determine how much of your paycheck your employer will withhold for tax purposes. You’ll want this information to stay as accurate as possible year after year since any inaccuracies could result in you underpaying taxes (and getting fined) or overpaying (and giving the IRS an interest-free loan of your hard-earned money). 

A few reasons why you might need to adjust your W-4 include: 

  • Getting a second job/new source of income outside of work.
  • Your spouse has a change in employment/income.
  • You were unemployed for part of the year (maybe you lost a few months of income during COVID-19).
  • Your marriage status changed.
  • You had a kid.

Even if you answered “NO” to all of the above, it’s worth making sure no other answers have changed. Do your future self a big favor and perform this five-minute exercise: 

  1. Check out the blank W-4 on the IRS website.
  2. Ask yourself if any of your answers have changed since you got your job.
  3. If so, ask your employer for a fresh W-4 to complete.

February

Now that you’ve honed your short game in January, let’s get your long-game finances in order in February. 

February 8th: open a retirement account

Want to start making money in your sleep? Open a retirement account.

It’s not just a trickle, either. Tinker with MU30’s investment calculator and you’ll find just how much you could make on your investment. 

But which type of retirement account is right for you?

If you’re already a full-time employee, your employer might’ve already opened a 401(k) for you. If so, make sure you’re making the maximum contributions each month. 

If your employer doesn’t offer retirement options, or you’re self-employed or between jobs, consider opening an IRA or an HSA. Opening a retirement account and setting up automatic contributions from your bank account can take as little as 20 minutes, and it’s the single best financial move you’ll ever make in your 20s. 

February 15th: open a savings account

Savings accounts are like piggy banks for adults. 

Unlike a retirement account, some would argue you don’t really need a savings account. They’re a great place to stash a little rainy day money and accrue a trickle of interest, but they’re not essential to your financial health. 

That said, you might just like the comfort of having a rainy day fund, separate from either checking or retirement, that builds on itself. 

If so, you can open a savings account in under five minutes with Chime. Chime consistently maintains a competitive APY (annual percentage yield = how much interest you’ll make) and offers novel features for savers like automatic savings, which rounds up your purchases to the nearest dollar and deposits the difference into your savings account. 

February 22nd: do your taxes (seriously)

Wait, isn’t tax day on April 15th? 

Yes, but there’s no reason to wait. Your employer (or clients, if you’re a contractor) is required by law to have mailed you all of the necessary forms by January 31st, so by now, you should have everything you need. If you can’t find the forms your employer sent you, well, now you have plenty of time to ask for a reprint!

Plus, if you electronically file your taxes by February 23rd, you can expect your refund by mid-March. The longer you wait, the longer you let the IRS withhold money that you could be investing. Do you really want to give the government an interest-free loan?

Now, if your employer isn’t withholding your taxes from your paycheck already, you need to fill out IRS Form 1040-ES. 

Here’s the skinny: 1040-ES calculates your owed taxes on a quarterly basis throughout the year. Form 1040-ES is due for each preceding quarter on April 15th, June 15th, September 15th, and January 15th (yeah, the due dates aren’t quarterly, but whatevs). 

For help filing either way, check out MU30’s guide to filing your taxes

March

2021 Personal Finance Calendar: Keeping Your Finances On Track In The New Year - March

Since there’s not a lot else going on in March, I’m officially designating it as Insurance Month. It’s the perfect time to find better rates on your auto and home/renter’s insurance and potentially opt into pet, life, and small business insurance to cover your bases. 

I promise this will be more fun and easy than it sounds. Some pretty cool new tools make insurance shopping quick and painless, and you’ll save hundreds in just a few hours of work. 

March 1st: find a better deal on auto insurance

I’d be willing to bet the pink slip to my Mazda Miata that you’re currently overpaying for auto insurance. 

The reason being, auto insurance companies are constantly competing to offer new policyholders better rates, signup bonuses, and coverage.

Meanwhile, they’re charging their existing policyholders more if they’ve been around for 2+ years. The “loyalty tax” is a common insurance industry practice, since companies assume they can get away with charging complacent customers who don’t shop around. It’s such a scam that I wrote a whole piece on it

Luckily, all you need to do to get a better rate is to shop around and either switch or ask your current provider for a better rate to match their competitors’. And the best place to start is with Gabi.

If you’ve ever gotten an insurance quote online before, Gabi asks for the same basic information (personal info, car details, driving history, etc.) The difference is that unlike a regular insurance site, Gabi will then show you up to a dozen competing offers at once. So right away, you’re saving hours collecting quotes online. 

It gets better, since you can upload your current policy terms and Gabi will focus on beating your current rate. In six months, Gabi will remember what you paid and try to beat it again 

So get Insurance Month off to a rockin’ start by saving money on auto through Gabi. And remember, you don’t have to switch providers; just bring your current provider proof of a better rate and they’ll do their best to match it. 

March 8th: find a better deal on home/renters insurance

Once you’ve secured a better rate for auto insurance, it’s time to do the same for your home and renter’s insurance

Policygenius is an aggregator like Gabi but for way more types of insurance. You’ll easily be able to find tons of quotes for both homeowners and renters insurance.

Keep in mind, also, that your current auto insurance provider might offer a nice discount on a home + auto bundle, so be sure to check them out first. 

March 22: purchase life insurance 

Look, if you’re young and healthy and nobody depends on you for income, you probably don’t need life insurance. But if you have dependents, or at the very least would like your funeral expenses covered, a cheap life insurance policy might be a good choice. 

I recommend Ladder. They’re very easy to use and the ability to change your policy terms on the fly is outstanding. For example, if your spouse suddenly lost their job and you became the primary provider for the household, you might want to bump up your coverage levels right away. 

March 29th: purchase small business insurance

Our final bracket in March Insurance Madness is small business insurance; a type of coverage most folks don’t know exists. 

If you’re a sole proprietor, contractor, or operate a small business yourself, small business insurance can help cover your assets and liabilities, such as:

  • Commercial property.
  • Equipment.
  • Medical malpractice.
  • Liquor liability.
  • Workers’ comp.

While most business insurance companies only have a dozen or so policy options, CoverWallet offers over 30. Plus, if you’re not sure how much of what type you need, CoverWallet assigns a live agent to help you through the process. 

April

Did you file your taxes for 2020 yet? Now’s the time!

April 15th: deadline to submit your 2020 tax returns

When April arrives, if you still haven’t filed your taxes, you’ll definitely want to file them electronically at this point. Personally, I recommend using TurboTax

Yes, you’ve probably heard that some tax filing companies say they’re free (but aren’t), but TurboTax free really is free. They do, however, have some premium options to make life even easier, and all are cheaper than hiring a private tax attorney to file for you. 

April 15th: 1040 ES due for 1st quarter 2021

Friendly reminder that April 15th is also the deadline to submit your 1st quarter 1040 ES form. Keep in mind that this is separate from your 2020 taxes, since you’re reporting on your income from the first quarter of 2021. 

April 15th: deadline for contributions to your Roth IRA

If you have a 401(k) through your employer, you don’t have to worry about this deadline. If you’re like me and have a Roth IRA, this deadline is for you!

Per the IRS, there are limits to how much you can contribute to your Roth IRA each year. It’s usually around $7,000, and you can no longer contribute if you make above a certain income threshold. 

Contributing the maximum amount is great if it falls within your budget, but maxing out your IRA isn’t always the right choice. You also want to be sure that you’re not waiting until the deadline each year to drop a scary lump sum into your Roth. Rather, set up automatic contributions from your bank account to your Roth. 

May

2021 Personal Finance Calendar: Keeping Your Finances On Track In The New Year - May

It’s almost summer! As soon as exams are over, you should make two moves that could save you tons of time and money. First, submit your FAFSA well in advance of the deadline, then get your car ready for those summer road trips

May 10th: fill out and submit your FAFSA for fall 2021

The Free Application for Federal Student Aid, or FAFSA, is a big, long, form that you’ll fill out to apply for federal tuition aid. 

The FAFSA for the 2021-2022 school year is already live at studentaid.gov, but it’ll take more than a few minutes to complete. You’ll need your parents’ record of income, tax records, social security info, and more. 

While the FAFSA isn’t due until June 30th, getting a head start gives you and your folks plenty of time to collect all of the necessary information.

May 18th: take your car in for a checkup and an oil change

Does an automotive care tip really belong in a personal finance calendar alongside retirement accounts and the FAFSA? 

Absolutely! As a car maintenance fanatic, I’d estimate that every $100 you invest in preventative maintenance will prevent $1,000 in repairs. For example, if you don’t perform $60 annual oil changes, you’ll certainly end up with over $600 in needed engine repair. 

Plus, keeping your car in tip-top shape is safer, prevents breakdowns, and helps your car hold its value. 

So give your car to a trustworthy local mechanic (not a dealer) and ask them to perform a head-to-toe checkup. They’ll top up your fluids, fill your tires, and give you a list of suggested maintenance to keep your ride safe and avoid expensive headaches. 

June

You’ve been working hard at keeping your finances in order so far, so June is mostly a relaxation month. Enjoy your summer!

June 15th: 1040 ES due for 2nd quarter 2021

This is just a friendly reminder that your 1040 ES for 2nd quarter 2021 is due on June 15th (yeah, not a quarter after the last one, but hey, I didn’t set the rules). 

June 30th: deadline to submit FAFSA

Did you submit your FAFSA for the 2021-2022 school year back in May? If not, it’s time to jump on it. The deadline is June 30th. And remember, you’ll need a lot of help and paperwork from your parents, so get crackin’!

July

2021 Personal Finance Calendar: Keeping Your Finances On Track In The New Year - July

Now that you’re halfway through the year and have your most important ducks in a row (retirement, FAFSA, etc.) it’s time to make some extra cash and have a little fun. 

July 5th: start investing

To be clear, a retirement account is an investment account, so you’re already an investor of sorts. 

That being said, you should always leave your retirement accounts to the pros, since they’ll know where to stash your money to give you safe, steady returns. Nobody should play fast and loose with their 401(k). 

If you’d like to get a little more hands-on, leave your retirement account alone and invest a few bucks from your checking account to get started. A great next step would be to download Public.

Public is a socially-driven investing app where you can buy, sell, and trade over 5,000 stocks. Plus, if you refer friends, you’ll get a free slice of stock valued at up to $50. Trades are commission-free, and your dividends are automatically deposited into your linked bank account. 

Perhaps best of all, Public offers the option to purchase partial or fractional stocks. So if you really want to invest in TSLA but don’t have the $500 for a whole share, you can buy part of a share for much less. 

August

In August, you’ll make one of my personal favorite ninja financial moves. I love sharing this tip because it not only saves time and money and reduces stress, it improves your relationships with your friends and family. 

August 1st: make your holiday budget

There are at least three reasons why I strongly recommend making your holiday budget months in advance. 

First, if you’re a student, classes probably haven’t started yet so you can more easily devote a half-day to this project. 

Second, many folks forget to include Halloween and Thanksgiving in their holiday budgets. On average, Americans spend $86 on Halloween and $186 on Thanksgiving, not including travel. So come December, they realize too late that they’re out of cash for Christmas. Plus, it’s cheaper and easier to book holiday travel months in advance. 

Finally, and certainly not least, I find that it’s much easier to kick off your Christmas shopping months in advance. You have time to brainstorm, months to wait for sales on big-ticket items, and best of all, you can more bluntly collect ideas from friends and family without giving away the surprise.

Trust me; having your travel and shopping done well in advance is an excellent way to enjoy a low-stress fall semester and holiday season.

September

2021 Personal Finance Calendar: Keeping Your Finances On Track In The New Year - September

September is a catchup month. The only official deadline is for the 3rd quarter 1040 ES, so you can spend the rest of the month checking boxes you might’ve missed earlier in the financial calendar. 

September 15th: 1040 ES due for 3rd quarter 2021

Another friendly reminder that your 3rd quarter 1040 ES is due to our friends at the IRS. 

October

In October, you’ll fill out the new FAFSA and start your health insurance journey. 

October 4th: file your FAFSA for 2022

Another FAFSA just five months after the last one?

Yep! The FAFSA for the 2022-2023 school year releases on October 1st, so you might as well knock it out early.

October 18th: enrollment for employer benefits begins

If you’re a full-time employee with health insurance benefits, this applies to you.

From mid-October through mid-December typically runs a period called open enrollment for employer benefits. This is the time to review your existing healthcare coverage through your employer and make changes. 

It’s important to spend a few minutes each year reviewing your employee healthcare coverage since you want to avoid either overpaying for coverage you don’t need, or missing out on the coverage you do need (and paying the piper later). 

Around this time, you should receive an email from your employer regarding open enrollment. Read through your options and premiums, and don’t hesitate to reach out to whoever sent you the email to ask for guidance. 

Finding the right balance of coverage and premiums through your employer can take as little as 15 minutes and save you hundreds in 2022. 

November

2021 Personal Finance Calendar: Keeping Your Finances On Track In The New Year - November

November is health insurance month! If you’re self-employed and purchase insurance through the Healthcare Marketplace, put aside a good half day in November to research and find the best possible coverage for 2022. 

November 1st: healthcare marketplace open enrollment begins

From November 1st through December 15th is a period called Open Enrollment. This is a bit different from open enrollment for employees since Open Enrollment is specifically about purchasing your own non-employee insurance through Healthcare.gov.

If you’re on your own and don’t already have health insurance through your school, employer, or your parents… do you really need it?

With average monthly premiums approaching $500, it may make more sense to go uninsured and pay out of pocket. The risk is minimal but extreme, so deciding whether or not to purchase health insurance for 2021 may be the most unpleasant financial decision you make this year. 

If you have a history of family medical issues and/or bad luck, your decision becomes a little easier and it’s likely you should just pony up for premiums. 

December

On a happier note, you’re almost done with a financially-savvy 2020! In December, you’ll put together a simple budget plan for 2022, submit a few forms, and tie a bow around an extremely productive year. 

December 1st: make your 2022 budget

Because you made your holiday 2021 budget back in August, your December is now freed up to think about 2022. 

Now, back in January, you used a combination of the Money Under 30 Budget Calculator and the slick Pocketsmith app to set and stick to a budget. 

How’d it go? Did you spend too much or too little in some areas? If you were your own financial advisor, how would you suggest adjusting your budget for an even better 2022? 

Finding the right budget can take years of honing and practice. You don’t have to reinvent the wheel, but rather, focus on making small, 5% adjustments here and there. Over time, your budget will adapt to fit your income, lifestyle, and savings goals, and the feeling will be glorious. 

December 15th: healthcare marketplace open enrollment ends

Friendly reminder that Open Enrollment to purchase health insurance through Healthcare.gov ends on December 15th. 

You might qualify for a Special Enrollment Period after Open Enrollment ends, but don’t count on it!

December 31st: 1040 ES due for 4th quarter 2021

The final step in your 2021 financial journey is to submit your last 1040 ES. 

Technically, the 1040 ES for Q4 of 2021 isn’t due until January 15th, 2022. But why start the new year off procrastinating?

Instead, I can’t think of a better way to cap off a massively successful, fiscally-savvy 2021 than to finish your 2021 taxes two weeks in advance!

Summary

That about wraps it up! If you followed along this year, you hit some pretty important financial milestones, like:

  • Opening a retirement account.
  • Applying for student aid.
  • Filing your taxes on time.
  • Maintaining your car.
  • Purchasing insurance.

And more. 

Now, this list isn’t 100% comprehensive and doesn’t cover everyone’s unique financial situation. But if you knock out these basics, you’ll be in an excellent place financially and can rest easy. 

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