How to prioritize your financial goals

Learn how to prioritize your financial goals in 2021

Are you having trouble prioritizing your financial goals? In this article, you will find out the best information to achieve your goals. Keep reading to find out all the details!

Are you having trouble prioritizing your financial goals? In this article, you will find out the best information to achieve your goals. Keep reading to find out all the details!

These are the years to tackle competing long-term goals, like saving and investing for retirement and your kids' education. By prioritizing and planning, it's possible to strike a balance.

As you're building wealth, it's a good rule of thumb to have started investing for retirement by participating in your employer's 401(k), contributing enough to take advantage of any employer match. Also, you need to prioritize paying off your high-interest revolving debt. Built-up an emergency fund of at least 6 months is also a good tip. 

These are the years to tackle competing long-term goals, like saving and investing for retirement

Should you save or pay down debts like a mortgage or college loan? Finding an appropriate balance between the two depends on your individual situation. Weigh the pros and cons.

Generally, experts say you should focus on maximizing tax-deferred savings first, but what you decide depends on your circumstances.

Tax-deferred (or "tax-advantaged") investments-like 401(k)s, Traditional IRAs, healthcare savings accounts and 529 plans-should be a top priority because your money has the opportunity to grow before the federal government taxes it. That means your initial investment is larger and as a result, you may have greater returns.

For many people, planning for retirement is a careful balancing act between providing for their own retirement security and meeting the needs of family members. 

First, focus on maximizing your retirement contributions for the year, making sure to take advantage of your 401(k) employer match (if any) and contributing up to the IRS annual limit if you can.

Next, set aside money for college: Your child can borrow money for his or her education, but it's unlikely you'll be able to borrow it for your retirement! When you invest in college with a 529 account, any earnings generated will be federal (and possibly state) income tax-free as long as withdrawals are used for qualified higher education expenses.

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