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My Word For 2020: Productivity

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productivity

Social media has changed the world in so many ways (some good, some bad). One thing it has certainly done (for me) is provided me with new, interesting ways to think about things and approach projects. Recently, I have seen people choose a word to represent the year to come. Many people have chosen words like “hustle” or “positivity.” My word for 2020 is “productivity.”

Why I Chose This Word

Of course, everyone wants to be productive, but I chose this word this year because last year was really busy. Even though I was running around and felt exhausted and busy constantly, I didn’t get as much done as I wanted to. Then I came across this inspirational post on Facebook and it really spoke to me. It said…

Be productive, not busy.

When I read that I was like, “that’s it! That’s what I need to focus on.” It is kind of like that old adage “Work smart, not hard.” I want to focus on improving my everyday processes to reach my goals (both short-term and long-term). Before starting projects, I’ll analyze what the best approach is to protect my time (and money).

Productivity Goals

A lot of my productivity goals for 2020 will require a bit of planning. To start, I’ve begun waking up just a bit earlier every day and jotting down a brief schedule of what I have planned. If you saw my last post, I talked about my main goals for the year and I plan to achieve each of these by being productive and planning out my day.

For instance, to achieve my goal of learning German, I will carve out 10 to 20 minutes every day for a quick lesson. To be able to read a book a week, I am scheduling about an hour a day devoted to that alone. My goal of practicing self-care every day will be achieved by waking up just a little earlier and taking care of my skin and practicing yoga.

Our main finance goal of paying off at least half of our debt will also be helped along by being productive instead of busy. Last year, we were a bit frantic with our financial plans. This year, we will track every penny and have a set plan for paying off our accounts.

All in all, I am hoping that setting a goal to be more productive (and less busy) this year will free me up to do more of the things I enjoy, like spending time with my husband, hiking, reading, doing makeup, and crafts. As I’ve stated in the past, a huge part of me being successful in life, and in my finances, is being able to achieve a balance. That’s why I’m choosing to be productive and NOT busy this year.

Readers, do you choose a word to describe your year? What is yours?

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Good News! The IRS Has Increased Retirement Contribution Limits for 2020

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retirement contribution limits

Most people on debt-free journeys aren’t thinking about retirement very often. If you follow the Dave Ramsey mindset, you don’t even begin really contributing to your retirement accounts until you’ve paid everything off. However, this week, the IRS announced some good news. The agency is increasing retirement contribution limits in 2020.

What This Means

If you are currently contributing any money to a 401(k), 403(b), or 457 plan, the amount you can contribute will increase starting January 1, 2020. It has increased from $19,000 to $19,500. Additionally, catch-up contributions will also increase from $6,000 to $6,500.

 

How This Can Help You

Retirement accounts are typically not taxed. By contributing the most you possibly can, it decreases the amount of your taxable income, which can help you save money as well as better prepare for your financial future. All in all, it is a great way to begin building your wealth.

It is important to keep in mind, however, that if you are currently still struggling paying off debts, it may be a good idea to hold off on retirement contributions. Instead, use the extra money to snowball your debt. After all, once you are debt-free, you will be able to throw as much money as you want towards your retirement goals.

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Planning for Unexpected Expenses

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planning for unexpected expenses

There is no doubt we’ve made strides in the right direction as far as our finances are concerned. However, there is still one area in which we are failing: planning for unexpected expenses.

This week I got the bridesmaid dress for an upcoming wedding in the mail (two weeks out from the wedding) and my worst nightmare occurred. It didn’t fit! It was far too late to return it for the correct size, so I decided to take it to a local alterations place. The total for the changes needed came out to $250.

The price definitely threw me for a loop and, because we aren’t using credit cards, it came directly out of savings. I was frustrated with myself for not planning ahead for alterations costs.

Why is Planning for Unexpected Expenses Important?

Planning for unexpected expenses is key to becoming debt-free. If we weren’t so devoted to not swiping our credit cards, I could have easily racked up another $250 in debt without batting an eye. The same is true for other expenses that may come your way out of the blue.

Failing to prepare for this is can lead to you hindering your debt progress. Not to mention, it can have an impact on your emergency savings and take away from paying off your debts. It can also put a dent in your emergency savings. Then you have to readjust your finances to refocus on padding your savings accounts once again instead of using the money for my debts.

How to Plan for Unexpected Expenses

Thankfully, there are things you can do to plan for the unexpected things in life. Here are a few tips to help you avoid the mistake I’ve made.

First, identify your unexpected expenses. Of course, we can’t always see into the future, but if there’s something that comes up with some regularity, you can try to plan ahead for it. For instance, property taxes, medical expenses, birthdays and holidays, and car repairs can all be planned for.

To identify other unexpected expenses, you can take a look at the past year’s bank and credit card statements. Note any irregular purchases and try to budget for that. You can add up the total of all the expenses and then divide it by 52 weeks. Set aside that amount every week moving forward. This can help you have the money set aside when something unexpected comes up.

Doing this will help you plan ahead and (unlike me) have the cash set aside when something may pop up. Do you have any additional tips you’d add? Leave them in the comments below!

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