Summer 2022 Financial Planning Guide

Key Takeaways

• Conduct a mid-year pay stub review to verify you're meeting your savings goals, check 401(k) and HSA contributions, and use the IRS calculator to determine if you're withholding the correct amount in taxes
• Create a one-page financial plan over a weekend by defining your core values (e.g., financial independence, family time), setting measurable goals aligned with those values, and identifying specific actions like automating savings to achieve them
• Apply the 50/30/20 budgeting rule: allocate 50% of net income to necessities, 20% to savings (401k, Roth IRA, extra mortgage payments), and 30% to discretionary wants; if you can't hit 20% savings now, set it as a future goal and increase contributions with raises
• Automate your savings transfers after identifying extra monthly cash flow from your mid-year analysis to remove the temptation to spend and ensure consistent progress toward your financial goals
• Focus planning efforts on what you can control (spending, savings rate, debt paydown) rather than external factors like inflation and the economy, which reduces financial anxiety and builds peace of mind