6 Tips To Be Financially Savvy in 2021

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April is financial literacy month, which is a good time to reflect on the state of your budget and financial plans. Financial literacy month is a national campaign organized by the Jump$tart Coalition to promote financial education while focusing on financial goals and money management.

We’re sharing some simple ways to budget and plan your financial future, plus a bonus tip on how to harness the power of your life insurance policy to help you achieve financial freedom.  

Review your budget

One simple way to accomplish a money-focused task during financial literacy month is to review your monthly budget. Whether you choose to use an excel sheet, a mobile app, or simply a pen and paper, writing out your budget can help you determine where you can cut costs and optimize spending.

Be sure to list your fixed expenses (mortgage, car payments, utilities) and flexible expenses (clothing, food, gas).

Once you plan your budget, you could automate some payments or direct some money into a high-yield savings account to watch your retirement savings grow.  

Share savings goals with your children

If you have children, teaching them early on about the importance of financial literacy can help set them up for success. Consider sharing your updated budget with your kids or encourage them to create a mini-budget of their own.

If you are interested in supporting your child’s college education, you may consider starting a college savings plan or purchasing a life insurance policy that can grow with your child over the years.

Save according to age

One common financial recommendation is to have a plan in place early for your retirement savings. The standard advice for retirement savings is that by the time you retire, you should have eight to 10 times your annual salary saved for retirement.

While this is an ideal situation, it’s not the reality for many Americans, as this plan would require you to have your annual salary in savings by age 30, twice your salary by age 35, and so on. 

If you aren’t able to stash away this amount, there are some simple steps to get on the right track. High yield savings accounts and banks that offer good interest rates can help you start saving comfortably. The best thing that you can do is to start saving now – no matter how much money you begin with.

Review your life insurance policies

If you already have life insurance, an annual policy review can help you make sure that your policy is still meeting your needs. Most of us get life insurance in our 20’s or 30’s and may have a spouse and/or a young child. As you age, you and your family’s needs will likely change, and this means your life insurance needs are going to change as well. 

The death benefit of your life insurance policy should match your family’s current financial needs – how much they’d need to continue their standard of living if you were no longer around. 

If you still need life insurance, now is a good time to get a low price on a policy.

With Quility, you can get a free quote for term life insurance at a coverage amount and term length that matches your needs. 

Most people don’t need to undergo a medical exam to get coverage, so you can get life insurance that fits your budget from the comfort of home.

Life insurance is crucial for financial wellness: Your policy can help you protect your loved ones while providing you with peace of mind.  

Invest in your retirement

A Charles Schwab report found that the average American citizen believes they will need $1.9 million in savings for retirement. However, a 2019 report by the Federal Reserve Survey of Consumer Finances found that American households have a median retirement account balance of $65,000.

To close this gap, it’s important to get a plan in place and stick to it. Consider a retirement savings vehicle with guarantees, such as an annuity.

An annuity is a contract between an individual and the insurance company, that once “annuitized,” requires the company to make regular payments to the individual either now or in the future. Many people use annuities as a source of guaranteed income in retirement.

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To learn more about how annuities can help you achieve your retirement goals, read our article  on the benefits of annuities.

Get a customized Debt Free Life plan

If you’re looking for a way to pay off debt for good, Debt Free Life can help. Debt Free Life is a customized plan fit for your budget that uses the cash value of a permanent life insurance policy to pay off debts. 

Debt Free Life is customized to pay off your specific debts, including credit card debt, mortgages, student loans and auto loans. 

Even more, you won’t be spending any additional money each month, as the plan uses funds from your life insurance policy to pay debts. This means that you won’t be paying interest to the bank, instead, you will be able to pay off debts one by one all while saving for retirement. 

Schedule a consultation to learn more about Debt Free Life

Schedule a consultation with an advisor today to learn more about Debt Free Life. During your consultation, you can see how much money you can have in retirement savings at the end of the program plus how much money you will save in interest over the years.

Budgeting and financial wellness in 2021 is more important than ever, and every step counts. Take control of your finances today with support from a Quility advisor.

Ready to Live a Debt Free Life?

Schedule a consultation with a Quility advisor to get a plan in place today.

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Calie Brummer
Head of Digital Communications
Calie Brummer is a staff writer and Head of Digital Communications at Quility Insurance with a focus on financial well-being and life insurance solutions.