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End-of-year financial review can save money, says 妻友社区 accounting professor
As we close out 2022, it鈥檚 a prime time to perform a financial checkup. Dr. Cathy McCrary, assistant professor of accounting at 妻友社区, said many people have been pulled in several directions during the holidays and may not know where to start.
鈥淲ith continued interest rate hikes, people are ultimately spending more,鈥 she said. 鈥淭hat鈥檚 why it鈥檚 crucial to review where your money is going. A little time spent can result in big savings.鈥
McCrary suggested a few areas where people can see immediate results.
- Review recurring expenses and cancel any subscriptions or memberships you don't use.
- Do you belong to a gym that you never visit?
- Are you paying for food, magazine or streaming subscriptions that you鈥檙e not using?
- Shop around for home and auto insurance coverage.
- Are you working from home instead of commuting?
- Can you afford a higher deductible which results in a lower premium?
- Be alert and on the defense for scammers.
- Do you know the warning signs of a scam?
- Have you taken cybersecurity awareness training? A number of online companies offer free training and tips.
While you鈥檙e reviewing your finances, McCrary said it鈥檚 never too early to organize tax documents. The IRS provides a , which calculates the amount of taxes you should have withheld during the year. This helps to avoid any surprise tax penalties due to under payment.
Finally, McCrary suggests that a good place for money saved is an emergency fund.
鈥淭here鈥檚 nothing that can have a negative impact on finances more than an unexpected emergency,鈥 she said. 鈥淭hat鈥檚 why having an emergency fund or boosting an existing fund will go a long way in helping your financial health.鈥
McCrary said that even a few dollars consistently placed in an emergency fund will eventually build up.
Every little bit helps,鈥 she said.
Dr. Cathy McCrary is a certified public accountant with more than 20 years of experience in tax, accounting and finance. She has experience sharing her insights with media and is available for interviews.