Discover how planning can be your secret to financial discipline, confidence and better results. Diego Cervo / Shutterstock.com
Editor’s Note: This story originally appeared on NewRetirement. So much of life is determined by your mindset. How you think about things can result in how things are and will be. Research has found that a “planning mindset” is actually everything when it comes to financial success — no matter how you define doing well.
Need cash now? Try these zippy tips for rapid rewards. pathdoc / Shutterstock.com
Advertising Disclosure: When you buy something by clicking links on our site, we may earn a small commission, but it never affects the products or services we recommend. Long-term financial planning is nice and everything, but who has the patience for that when you want results right now? What’s something you can do today that’ll put more money in your pocket? That’s right, we’re looking for…
Many people rely on their tax refunds to cover essential bills. Read on to see why future refunds of yours might arrive sooner.
Image source: Getty Images
The majority of people who file taxes end up getting money back from the IRS. And for many, those tax refunds are a financial lifeline.
The average tax refund for the 2023 filing season was $2,812. That’s not a small amount of money. And it’s easy to see why having to wait on a lump sum like that might create a financial crunch.
The good news is that the IRS is working on plans to expedite the process of issuing refunds. And that could make it so millions of taxpayers are able to receive their money sooner.
The IRS says that 90% of the refunds it issues are sent out in 21 days or less. But there are different factors that can hold up a refund.
One is human error. The IRS might need time to investigate and attempt to rectify a mistake on a tax return, resulting in a delay.
But also, while most taxpayers file their returns electronically, there are those who still prefer the old school method of filing on paper. Those paper returns need to be processed manually, leading to delays.
Similarly, it’s often the case that the IRS will notify taxpayers by mail that it needs supporting documentation to finish processing their returns. Tax-filers in that situation generally have to mail such documentation back to the agency. The result? A lengthy process that keeps people waiting for their money.
But having to wait longer than 21 days for a refund is problematic for people living paycheck to paycheck with no money in their savings account. A taxpayer who’s forced to sit tight for six weeks to receive a payment in the ballpark of $2,800 might end up having to rack up temporary debt to cover their expenses until that money comes in. So the fact that the IRS is taking steps to speed up the refund process is a good thing.
The IRS is taking steps to digitize the tax-filing process. Beginning next year, taxpayers will have the option to digitally upload documents needed to support their tax returns instead of being forced to send them in by mail. This change should enable up to 125 million paper documents to be filed online every year.
Furthermore, by the 2025 filing season, the IRS expects to be able to digitally process all paper returns. An estimated 76 million returns could then be in line for faster processing and review.
It’s a great thing that the IRS is rolling out changes to expedite the process of issuing refunds. But if you’re eager to get your 2023 tax refund as quickly as possible, make sure to file this year’s return electronically, and do your very best to avoid errors. A simple blunder like entering the wrong Social Security number could result in a weeks-long delay in your refund that hurts you financially.
Also, one benefit of filing electronically is that the software you use will do a lot of your calculations for you, thereby reducing the chances of a human math error. But tax software can’t overcome incorrect inputs.
So if your W-2 summarizing your annual wages shows that you earned $45,700, but you put in that you earned $47,500, your return will be off. And your refund could get delayed as a result.
Before you submit your tax return, take a few minutes to do some proofreading. And if you have a spouse or trusted person in your life who can eyeball your electronic filing, even better. Having a second set of eyes could reduce the likelihood of a mistake when you’re filing taxes without the help of a professional.
If you’re using the wrong credit or debit card, it could be costing you serious money. Our experts love this top pick, which features a 0% intro APR for 15 months, an insane cash back rate of up to 5%, and all somehow for no annual fee.
In fact, this card is so good that our experts even use it personally. Click here to read our full review for free and apply in just 2 minutes.
We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.
It’s common to have your mortgage loan servicer pay your property taxes on your behalf. Read on to see why that arrangement doesn’t work for me.
Image source: Getty Images
When you buy a home, you don’t just take on the expense of a mortgage. You also have to cover additional expenses like homeowners insurance, maintenance, repairs, and property taxes.
The latter can be expensive in my home state of New Jersey. With a median property tax bill of $8,928, people in my state often spend a lot of their income on housing. This holds true even when they manage to keep their mortgage payments to a minimum.
Meanwhile, a lot of my friends who own homes make a single payment every month to a loan servicer that covers their mortgage payment, property taxes, and homeowners insurance. But I don’t like the idea of my mortgage loan servicer paying my property taxes for me. Here’s why.
It’s very common to make a single payment monthly that covers your property taxes and homeowners insurance on top of your mortgage. What’ll happen is that a portion of that money will be used to pay your mortgage immediately, and the rest will be put into an escrow account to cover your property taxes and homeowners insurance as those bills come due.
Unlike your mortgage payment, which is due every month, property taxes are generally paid quarterly. And your homeowners insurance payment might only come due once a year. So what your loan servicer will do is reserve the extra money you’re paying each month in an escrow account so it can cover those expenses.
You may be wondering why I have a problem with this arrangement. And the reason is that loan servicers want to make sure you’re paying enough into your escrow account to cover those additional expenses as they come due. As such, you’ll generally be charged extra above what those secondary items actually cost.
As an example, let’s say your monthly mortgage payment is $1,000, your homeowners insurance costs $100 monthly, and your property taxes cost $1,000 a month (in my state, that’s more than possible). So all told, you’d be looking at $2,100. But what your loan servicer might do is charge you $2,200 or $2,300 so it has a cushion.
That’s understandable. But it doesn’t work for me.
Because my property tax bill is so ridiculously high, I know that if I were to have my loan servicer pay it for me, I’d have to send over hundreds of dollars extra each month beyond what I really owe. That’s money I’m not looking to part with before I have to.
The upside of having your mortgage loan servicer pay your property taxes (and your homeowners insurance) is that you don’t have to worry about forgetting to pay those bills yourself. They may not necessarily be on your radar since they don’t come up every month.
But an easy step I take to get around that is to set up automatic payments from my bank account once my annual property tax bill arrives. So let’s say that bill comes in August, which it usually does in my neck of the woods. Usually, I’ll have payments due in August, November, February, and May. So I’ll take a look at what I owe, go into my checking account, and then set up those four payments in one session so I don’t have to worry about forgetting later on. That way, I’m not sending anyone any extra money.
If your property tax bill isn’t particularly high, you may just find it easier to have your loan servicer pay that expense for you. And you may not have to put too much extra money in your escrow account. But because my taxes are so darn high, it’s better for me to just pay them myself than have to part with additional funds month after month.
Our experts vetted the most popular offers to land on the select picks that are worthy of a spot in your wallet. These best-in-class cards pack in rich perks, such as big sign-up bonuses, long 0% intro APR offers, and robust rewards. Get started today with our recommended credit cards.
We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.
Overloading your portfolio with stocks as a retiree can be risky. Read on to see why.
Image source: Getty Images
You’ll often hear that it’s a good idea to load up your brokerage account or IRA with stocks during your working years. The stock market has rewarded investors with an average annual 10% return over the past 50 years, as measured by the S&P 500. So going heavy on stocks during your career could help you retire with enough money to meet your goals and then some.
But while it’s a good idea to use stocks to help grow wealth for retirement, it’s another thing to invest the bulk of your savings in them during retirement. Going this route could mean taking major losses in the event of a stock market downturn.
When you’re in your 20s, 30s, 40s, and even 50s, you’ll often hear that it’s smart to go heavy on stocks. The general consensus is that if you’re investing for a goal that’s at least 10 years away, you’re okay to go all-in on stocks because you have time to ride out market downturns.
But once you enter retirement, you might start raiding your portfolio regularly to cover your living expenses. And that’s not a bad thing — it’s what that money is for!
However, what you don’t want to do is end up having to cash out investments at a time when their value is down. That could lead to permanent losses in your portfolio.
And that’s why going too heavy on stocks in retirement is risky. The stock market can swing wildly — we all know that. So if you’re in a position where you might have to tap your portfolio at any time, you should have a decent chunk of assets outside of stocks whose value doesn’t tend to fluctuate to such extremes. Bonds generally fit this category, and having some cash on hand is a smart bet, too.
The percentage of assets you keep in stocks as a retiree should hinge on a few different factors. These include:
Your personal tolerance for riskOther income sources you have at your disposal (for example, Social Security, a pension, and earnings from a part-time job)
But some financial experts will tell you that a 50%-50% split between stocks and bonds is a good bet. That way, the stock portion of your portfolio can continue to generate strong returns while you’re in retirement, but the bond portion can serve as tappable income in the event of a stock market decline.
Other experts will tell you to use the rule of 110 to determine your optimal stock allocation. That rule has you subtracting your age from 110 to see what portion of your portfolio should be in stocks.
So if you’re 70, you’d aim for a 40% stock allocation. However, you can play around with that number if you have a higher tolerance for risk or other robust income sources to turn to.
You definitely don’t want to dump your stock holdings completely during retirement. Doing so could lead to minimal growth in your portfolio during that time, and that’s not ideal. But it’s also important not to go too heavy on stocks. Rather, aim to strike a balance that works well for you.
We pored over the data and user reviews to find the select rare picks that landed a spot on our list of the best stock brokers. Some of these best-in-class picks pack in valuable perks, including $0 stock and ETF commissions. Get started and review our best stock brokers.
We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.
Want to see your net worth take off? Read on for ways to achieve that goal over the next three months.
Image source: Getty Images
Growing your net worth is a marathon, not a sprint. Some people manage to retire with a net worth of $1 million. But rest assured that $1 million net worth is decades in the making.
The median net worth across all Americans is about $122,000. That’s a pretty impressive sum. And whether your net worth is considerably lower, higher, or comparable, you may be eager to boost it before 2023 wraps up.
If that’s a goal you’re going to set, it’s important to have reasonable expectations so you don’t wind up disappointed. You shouldn’t necessarily expect your net worth to grow by $10,000 in the next three months — not unless you’re getting some magical bonus at work that you’re able to sock away in the bank.
But you can take steps to grow your net worth modestly by the time 2023 comes to a close. Here’s how.
Your net worth is measured by taking the sum of your assets and subtracting your debts. So let’s say you have $10,000 in savings, but owe $1,000 on your credit cards. That leaves you with a net worth of $9,000. If you manage to pay off that $1,000 balance, you’ll have a $10,000 net worth instead. Doesn’t that have a nice ring to it?
Now, you may be thinking, “How on earth am I going to pay off $1,000 in just three months?” But a side hustle might come to your rescue there.
In the coming weeks, many businesses are apt to need more hands on deck as the holiday season approaches. If you start exploring your options now, you might manage to line up a great side gig by mid-October. And if you’re able to earn $100 a week, you could be debt-free by the end of the year.
The more money you’re able to put into your savings account, the more you can grow your net worth. And if you’re wondering where to find the cash, the same advice as above applies — turn to a side hustle or take advantage of the gig economy.
Sure, you could also cut your spending. But let’s be real — who’s cutting their spending at a time when the holidays are right around the corner? If anything, you might actually end up increasing your spending due to buying things like holiday gifts, cards, and decorations. But if you’re able to boost your income in a way that outpaces your extra spending, you’ll still come out ahead.
Your net worth is measured based on all of your account balances, including retirement plans. If you’re able to put extra money into a traditional 401(k) or IRA, you won’t just have a higher dollar amount in your personal asset column. You’ll also shield some of your income from taxes. That could result in a higher refund that helps you grow your net worth nicely in 2024.
What’s more, if you have a 401(k) that comes with an employer match, contributing extra to it between now and the end of the year could go a long way toward building up your net worth. Let’s say your employer will match 100% of 401(k) contributions of up to $3,000 a year, and you’ve put nothing in so far. If you manage to contribute $3,000 between now and December thanks to your side hustle, you’ll end up with $6,000 in your 401(k).
The result? An even higher boost to your net worth.
Growing your net worth is something to focus on doing over time. And you don’t want to put too much pressure on yourself on a near-term basis. But you should know that there are ways to grow your net worth modestly over a short period. If that’s important to you, then these moves are worth aiming for.
If you’re using the wrong credit or debit card, it could be costing you serious money. Our experts love this top pick, which features a 0% intro APR for 15 months, an insane cash back rate of up to 5%, and all somehow for no annual fee.
In fact, this card is so good that our experts even use it personally. Click here to read our full review for free and apply in just 2 minutes.
We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.
© 2026 Madam Money®. All Rights Reserved. | Designed by SRJWebsites.com
