Atled Financial, LLC is pleased to offer tips to help keep your money goals on track this month. Between celebrating mothers and Memorial Day barbecues, make some time this month to take care of financial tasks as well. That way, you can really enjoy your spring, knowing that your finances are on track.
If your home’s value has risen since you purchased it, you may be able to eliminate costly Private Mortgage Insurance (PMI). This is also a good time of year to contribute to college savings accounts.
Here are a few other suggestions to add to your May financial to-do list:
Stop Paying PMI
If you bought your home for less than 20 percent down, you’ve probably been paying private mortgage insurance (PMI) on your loan, which is typically an extra 1 percent of the purchase price. However, the rise in home prices over the last few years has meant a rise in equity for homeowners with a mortgage of an additional 8.1 percent last year, according to CoreLogic.
If your equity position is now at least 20 percent of the original purchase price, you may not have to pay mortgage insurance anymore. Contact your mortgage servicing company to see whether your PMI can be removed. Payment of a few hundred dollars for a new appraisal may be required, but in the end, thousands per year could potentially be saved. For example, the PMI on a $300,000 home is about $3,000 per year.
Take Advantage of 529 Day
The college savings industry has embraced May 29th as “529 Day.” It’s an opportunity to remind parents of the benefits of saving in a tax-advantaged 529 college savings account for their collegebound students.
Fewer than 1 in 3 parents who are saving for their children’s college use a 529 plan, according to Sallie Mae, but it can be a valuable tool. Money put into a 529 plan grows tax-free, and there are no taxes on withdrawals used to pay for college. Also, up to $10,000 can be used tax-free for qualified K-12 expenses.
Dispose Unneeded Financial Documents
This is a good time to weed out financial documents that are no longer needed.
The length of time to wait before disposing of a document varies. For example, there is no need to keep ATM and bank-deposit receipts for more than a year. Retain loan documents until the debt is paid off, and investment purchase confirmations should be kept until sold.
Generally, tax documents can be discarded after seven years.
If you don’t have a shredder or have too many financial documents to get rid personally, find out when your local municipality is holding free shredding days.
Also, review documents stored on the computer that need to be deleted. This also goes for external drives and mobile devices. There are several ways to securely delete data from computers such as using Eraser, a free software program for PCs. For mobile devices, delete any unused apps.
Review Recurring Charges
Small charges can slip through unnoticed, especially if they’re recurring fees for a service you keep meaning to cancel. Keep in mind that these small fees add up quickly.
Take a look at your most recent credit card statement and highlight any charges that could be eliminated, like the gym you never visit. Contact the companies to cancel your subscriptions.
Budget for Home Improvement Projects
May is a great time to find deep discounts on materials for the home improvement projects set to be tackled this summer. Whether its installing a new deck or updating the siding on your home, money can be saved by making these purchases now, rather than mid-summer.
Certain projects, such as deck replacement and roof repair, are big undertakings that may require hiring labor as well. Saving money on the materials can go a long way toward stretching the budget.
Even if you aren’t quite ready to get to work, still measure how much roofing or decking you’ll need so that you can take advantage of the great sales this month, especially around Memorial Day.
It’s the little financial things that can up to big cost savings!
Connect with Delta Jones-Walker and Atled Financial on Facebook, Twitter: @Atled_Financial and LinkedIn! To schedule a free consultation or a presentation to your group or organization, call 219-513-3710 or email [email protected] and mention this column. Topic ideas for this column are welcome!
Securities and investment advisory services offered through Woodbury Financial Services, Inc., (WFS) member FINRA/SIPC. WFS is separately owned and other entities and/or marketing names, products or services referenced here are independent of WFS. Insurance services offered through Atled Financial Group 3801 Ridge Road, Highland, IN. 46322
