Debt Free Life Hacks

What are you retiring to? Think about this early, just as you may think about what you're retiring from. I recently listened to a podcast featuring a woman who had retired early and was feeling unsure about retirement after only six months. "I really don't know how I'm feeling about retirement anymore. I was a little excited to get here, but now I'm kind of sad being here.  I'm sad that I had a great connection with my clients and my work community, so the sadness is like I don't see these people anymore. I'm not making these connections." It's not like she had nothing going on—she had her girlfriends, enjoyed brunches and outings with them. However, she still felt a sense of sadness about losing her work connections. She had done some of the things we think are the "right" things to do—she had a pension lined up, although she was still waiting for her first check and seemed to be struggling financially in the meantime. But what reall...

In a  previous article , I wrote about FICA and how you pay Social Security  and Medicare taxes. Let's dip into that a bit more.  Are you eligible for Social Security benefits? There is an easy way to find out.  I encourage you to create your  "My Social Security"  account on www.ssa.gov to learn about your benefits, view your earnings record, estimate your benefits, and more.  Why do Social Security Benefits Matter? Social Security Benefits could mean different things to different people. Some people use projected benefits to aid in retirement planning. You may choose not to use them in your projections, but it's still a good idea to be aware of your status. You also learn about other benefits you may qualify for. Remember OASDI - Old-Age, Survivors, and Disability Insurance ?  All of this information can be found on the SSA's website at  www.ssa.gov.   What's in your Social Security Statement? There's a lot of information in your stat...

Shoulda, Woulda, Coulda I'm typically not the shoulda woulda coulda type of person, but when it comes to saving for retirement there are some things I would have done differently had I known better. Ignorance may be bliss until you realized that such bliss may have cost you hundreds, really more like thousands in potential earnings and growth.  😲 So what am I babbling on about? The value of time and the power of compound interest . 🤑 I'll Contribute More Now and Catch Up There's a scenario that describes two different investors who begin investing, one starts in their 20's, the other in their 30's. Long story short ( because the long story may bring actual tears to your eyes😢 ), the one who started at a younger age, contributed less, and saved for a shorter period ends up with more money at the age of retirement. See what I mean about shoulda woulda coulda? Yeah...it hurts! Why didn't anyone tell me? With that being said, It's usually best to start wher...

Did you know that the government incentivizes taxpayers for certain things? It's true. For example, the government offers the Retirement Savings Contribution Credit, commonly called the Saver's Credit. This tax credit rewards taxpayers who invest in their future by saving for retirement. It reduces your taxes while also encouraging you to save for retirement. How much is the credit? The credit is up to $ 1,000 (up to $ 2,000 if Married Filing Jointly). While this may not seem like very much, every little bit helps, especially when reducing tax liability.  How does it work?  Based on your Adjusted Gross Income (AGI) and filing status, you can receive a credit of 10%, 20%, or 50% of eligible contributions to a 401(k) or an individual retirement account (IRA). This is a non-refundable credit that reduces the amount of taxes due but cannot exceed the amount of taxes owed.  Who qualifies for the credit? Individuals 18 or older who cannot be claimed as a dependent on an...

Try not to get too excited, but this week we're talking about taxes! 😆What do you know about FICA? Have you ever noticed the deduction on your pay stubs and wonder what it was all about? FICA stands for Federal Insurance Contributions Act (FICA); put simply, FICA is a federal payroll tax. FICA is the money that comes out of your gross wages to pay social security taxes  ( old-age, survivors, and disability insurance ) and Medicare taxes ( hospital insurance tax ).  How much comes out of your check? The total amount that you pay is 7.65% of your gross wages. 6.2 percent goes to social security tax , and the remaining 1.45 goes to Medicare tax . Unless you're self-employed, your employer helps out by matching your contributions bringing the total to 15.3%. Self-employed individuals are responsible for the total amounts. Keep in mind that everyone's situation is different, these amounts apply to many, but there are exceptions. Individuals over a certain income threshold may ...