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With the year 2023 drawn to a close and 2024 getting underway, it’s a good time to look back at personal finance moves I made over the course of the year so I can see what worked for me — and what didn’t.
Fortunately, last year was a pretty good year in terms of my finances, as I made three smart money moves that ended up paying off. Here were the best things I did with my money over the course of the last year that I think will benefit me for a long time to come. Maybe seeing what I did will inspire you to do the same in 2024.
I increased my retirement account contributions
The first big thing I did in 2023 was to increase the amount I was contributing to my retirement accounts. I made the decision to do this because my income went up and I wanted to make sure that I was investing enough of my current earnings in my brokerage account to help me have a more secure future.
I decided to increase my retirement account contributions by a total of $4,000 last year, so I increased the automatic contributions I was making to my account by $334 per month. If I stick with this — and I plan to — the extra $334 I’m investing every month from now until retirement (in about 25 years) could leave me with a nest egg that’s around $432,000 bigger than it otherwise would have been. This is assuming I can earn an average return of 10% every year (in line with the stock market’s past performance).
If you aren’t already contributing 15% to 20% of your income to your retirement account contributions, or if your income has gone up and you haven’t compensated for that in your investing, you should seriously think about upping your own retirement investing goals for 2024.
I automated contributions to my savings account so I could pay for a home renovation in cash
I was planning a big home renovation toward the end of last year for a new home I was purchasing. I didn’t want to borrow for the upgrades, especially since I was already taking out a mortgage on the property, so I wanted to save enough to pay cash to my contractor.
I figured out the amount I needed to save, opened up a dedicated savings account, and transferred money automatically from my checking account to my savings account every month. Fortunately, I ended up accomplishing my goal, and renovations on the house are underway.
If you have any short-term goals, whether it’s home upgrades or another big purchase, figure out how much you need to cover the costs on your desired timeline. Set up automatic contributions to a savings account to fulfill your goal, and use a dedicated account so you can easily track your progress and be sure you’re on schedule.
I shopped around for a mortgage loan
Finally, the last good financial move I made last year was shopping around for a mortgage loan instead of just accepting the first offer I got from my bank. The difference between my best and worst rate was 1.61%, so by comparing quotes, I ended up saving $86 per month per $100,000 I borrowed — and saving $31,193 in interest per $100,000 borrowed over the life of the loan.
If you are doing any major borrowing, whether it is a mortgage or a car loan, you should make sure you shop around for the best deal as well. It’s easy to do, and the savings is worth it.
By making these three money moves last year, I’ve improved my financial situation for the long term. My retirement is more secure, my housing payment is more affordable, and my home will be a lot prettier in the end once the renovation is done and I’m not paying loan bills to afford it.
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