Healthy, wealthy, and wise: These financial New Year's resolutions will carry you through 2019 and beyond

Jan 24 2019 | 12:56 PM

It’s the start of a new year, and there’s no time like the present to peg down some financial goals for 2019 and the years to come. Here’s some quick tips to get you started and keep you financially healthy at any stage of life.
If you’re a teen …
Financial aid and scholarships cover a good chunk of college costs, but most students need loans to fill the gaps. Many students will borrow from $30,000 and $100,000 to cover the price tag of a four-year degree.
If you’re considering college, educate yourself on higher education costs. You can get started right now.
Colleges in the United States are required to post their cost of attendance (COA) each year. This COA accounts for the costs of tuition and fees, books and supplies, room and board, transportation, and personal expenses the average student incurs in one or two semesters. Look up the number and stare it down.
Next, the Free Application for Federal Student Aid (FAFSA) unlocks your access to federal student loans and grants, the most practical college funding source you have. Federal loans carry low, fixed-interest rates that tend to make monthly payments a little more palatable.
Now it’s onto free money. Whether it’s $50 or $50,000, a scholarship helps drop that COA in a hurry. The search will take a lot of work, but the paycheck you earn could be priceless. Also, every school has a financial aid office. Use it.
After you’ve gathered all your federal funds, scholarships, and financial aid, take another look at the cost of attendance. If you’re like most students, you’re going to need more. Consider using your credit union. Credit union loans offer competitive rates, in-school deferment, and a graduated repayment option.
If you’re a new parent …
Adding a new member to your family is a significant expense, which is why it’s vital to consider your costs and budget accordingly. For example, daycare can top $10,000 a year, depending on where you live. Add to that essentials like food, clothes, and diapers, and you’re talking about real money.
And it’s never too soon to plan for the hefty costs of higher education. Consider starting a 529 College Savings Plan. A starting contribution of only $10 to $20 per paycheck can really add up by the time your little one turns 18. Plus, you can encourage family and friends to add to it in lieu of gifts for special occasions, like birthdays and holidays.
Finally, don’t forget to consult with your health insurance provider. Most companies typically allow only 30 days to add your new baby to your insurance plan. Ask if it would be cheaper to separate your plan from your spouse’s.
If you’re a retiree-to-be …
There are several important milestones to be aware of as you approach retirement.
• Age 50+ – Catch-up contributions
Make sure you’re doing all you can today to add more to your retirement plans so you have more to work with when you are no longer working.
• Age 55 – Early retirement
The IRS Rule of 55 allows an employee who leaves a job between the ages of 55 and 59 ½ to draw money from their 401(k) or 403(b) plan without the usual 10 percent penalty, as long as those accounts were established by your current employer. To draw money from accounts established by former employers, roll those assets into your current 401k prior before leaving your current job.
Before you decide what to do with your retirement plan, have your accountant, attorney, and financial consultant review what’s in your plan and when and how you plan to use your funds. Make an extra effort to avoid unnecessary taxes or penalties.
• Age 59 1/2 – Penalty-free IRA withdrawals
You’re approaching a key milestone in retirement planning. The IRS allows you at age 59 ½ to withdraw money from your IRA without penalty.
• Age 62 – Early Social Security Benefits
This is the age most people start taking Social Security benefits. However, those who take advantage of this date will receive a 25 percent permanent benefit reduction. A financial consultant can explain the reduction, as well as Social Security taxation and limited distribution strategy consequences.
• Age 65 – Medicare sign-up
Your Medicare enrollment clock is ticking as you approach age 65. Medicare enrollment begins three months before you turn 65 and continues for 7 months. If you are currently receiving Social Security benefits, you will be automatically enrolled the month you turn 65. A financial consultant can make sure you know what this means for you.
n Age 66 – Full Social Security benefits
If you decide to begin taking your Social Security benefits at age 66, it’s a great time to review your retirement income strategy with your accountant and financial consultant. You may have to make adjustments to account for the taxation of your Social Security benefit.