Now that tax season is over, most people want to forget about taxes for the rest of the year, especially if the government took a hefty chunk of change. Rather than presenting more tax tips, the following are some useful tips for fiscal responsibility you can use all year long:
• Avoid impulse spending – whether you’re at the grocery store and want an extra bag of chips or at the electronic store thinking about a new TV, sticking to budgets can significantly improve your financial situation. If you really need that new TV, take a look at your budget and prepare yourself for the expenses you may need to cut to be able to afford the purchase and pay your bills on time.
• Keep detailed records – If you have a paper trail of all your purchases, you’re less likely to go over budget. You can review your expenses and get an idea of your problem areas where you spend too much money. You can even look into getting an app that tracks your expenses. It can be surprising where your extra money ends up going. For instance, a coffee a day can cost over $500 a year.
• Save your money before you receive it – Whether you want to contribute more to your retirement plan, savings account, or even your Christmas piggy bank, setting up contributions that go directly from your paycheck into the appropriate account will help you to save. Rather than considering your contributions on a weekly or monthly basis, you can automatically make your contribution from your paycheck. This will shorten the savings process and you will know you only have the money in your checking account to spend each month.
Alyssa McBride, Associate Accountant, Davis & Hodgdon Associates CPAs
Davis & Hodgdon has been assisting individuals and businesses in the Burlington Vermont Metro area for more than 20 years. The firm provides tax planning for individuals, corporations, trusts and estates that are seeking effective strategies to keep more of what they’ve earned. We also prepare all types of tax returns, including individuals, businesses, gifts and estates, trusts, nonprofits and foundations. For more information please call 802.878.1963 or email [email protected].