10 Important Financial Moves for 2023 With Mark Biller

Ask not what your finances will do to you in 2023 ask what you will do with your finances! That, of course, is a play on a famous JFK quote, but it describes the need to take a proactive role with your finances in the New Year coming up. Mark Biller joins us today to tell us how to do that. Mark Biller is executive editor at Sound Mind Investing. At the end of each year, SMI compiles a list of tips to prepare for the ahead. You’ll find this year’s post, Your 10 Most Important Financial Moves for 2023, SoundMindInvesting.org. Biller explains that it’s a round-up of planning suggestions for the year ahead. Rather than providing a one-size-fits-all type list, they instead serve up a broad range of ideas. The reader then picks their own personal Top 10 for 2023 list from the 70 or so suggestions discussed. Doing that and then following through on those specific items will make you a better steward of your resources and help you move closer to your long-term goals. The suggestions are broken into several categories: SPIRITUAL AND FINANCIAL FUNDAMENTALS Here are a few of the spiritual and financial fundamentals on the list: - Acknowledge God as the Lord over your finances. That’s the starting point of Christian stewardship and an important ongoing aspect of a deepening relationship with Christ. - Make a plan for your financial journey. On these programs together, we frequently discuss the need to develop a biblically sound, personalized money-management strategy that informs your spending, saving, investing, and generosity. - Resist financial temptations. Handling money well takes more than learning the rules of good financial management. You also have to practice and develop self-control. Thankfully, self-control is a fruit of the Holy Spirit! So as we draw closer to Christ, that fruit should become increasingly manifest in our lives. STRENGTHENING YOUR FINANCIAL FOUNDATION If your foundation isn’t fully in place, you should concentrate your 2023 efforts on the suggestions in this section. - Take advantage of the world’s most effective personal finance tool: a budget. Unpopular perhaps, but a well-planned and executed budget is the single best tool available for effective money management. - One new one to the list this year is to comparison shop for higher interest rates on your savings. Interest rates have moved from near zero a year ago to the 4.0% range today. So moving your money to a savings account at an online bank can meaningfully move the needle on the amount of interest you can earn. - Similarly, consider putting some of your savings in U.S. Government I-Bonds. We’ve talked about I-Bonds a number of times together in recent months because they are paying inflation-adjusted rates well above any other savings vehicle. They have some restrictions but can be extremely attractive in the right circumstances. DEVELOPING YOUR INVESTING PLAN There is a lot in this section 26 suggestions! But here’s the most important big idea: Scripture encourages us to prepare for the needs of tomorrow without becoming hoarders. So these suggestions can help you invest as a faithful steward who acts with prudence and wisdom. - Identify obstacles that are holding you back from saving for retirement and start moving them out of the way. Common roadblocks include auto loans, expensive housing, and generally poor money management. But often the biggest obstacle is simply not having a financial plan or any measurable goals. - Get familiar with the foundational biblical precepts related to investing. The Bible offers many timeless principles related to investing and wealth. Studying them and allowing them to become part of your thinking will help you apply those ideas to the investing decisions you face. - Become a better investor by using an inside-out approach. But the big idea here is to make investment decisions based on your personal inside-out needs and circumstances, rather than on outside-in expert opinions or market news. BROADENING YOUR PORTFOLIO Once you become an experienced investor, you can broaden your portfolio either to reduce risk or take advantage of market conditions. A few examples from this section include: - Learning about investments beyond stocks and bonds. We just had the worst year for traditional 60-40 stock/bond portfolios in decades. Fortunately, there are other options available today, and learning about things like commodities, real estate, and gold, just to name a few, can help add some additional diversification to a core portfolio. - On a similar note, learning about some easy ways to hedge market downside may be worthwhile. SMI has discussed several of these techniques and products this year. One that you may have to grapple with whether you go through our list or not is understanding the new investment options coming to many employer-based retirement accounts. Not all of these are necessarily good options, so it’s important to be informed. LOOKING FORWARD TO RETIREMENT - Take advantage of the current bear market to convert Traditional IRA money to a Roth IRA. With investment account values down this year, it can be an attractive time to consider a Traditional-to-Roth conversion in order to have more tax-free income in retirement. - Another example from this section is assessing how much money you’ll need to maintain your standard of living in retirement. SMI has some helpful pointers on how to do that for those with that transition on the horizon. And the most important category of all YOUR RELATIONSHIP WITH GOD First and foremost, Invest time in it. The most important goal of a Christian steward is to know Jesus the One who IS the pearl of great price. Valuing your relationship and communion with Him above your wealth and investments is a key cornerstone to keeping all this financial stuff in perspective. This has been a tough financial year for a lot of people. But if we trust in Jesus and bring our concerns to him, Christ will deliver us through the difficulties of life. We can live in hope because we serve a God who is too strong to lose control of any situation, He’s too wise to make mistakes, and He’s too loving to ever abandon us. Learn more about Sound Mind Investing at SoundMindInvesting.org. On today’s program, Rob also answers listener questions: ● What factors should you consider when deciding whether to purchase a home right now? ● Would it be wise to open an annuity for an adult child? Remember, you can call in to ask your questions most days at (800) 525-7000 or email them to [email protected]. Also, visit our website at MoneyWise.org where you can connect with a MoneyWise Coach, join the MoneyWise Community, and even download the free MoneyWise app. To support this ministry financially, visit: https://www.oneplace.com/donate/1085/29