15 of the Best Money Moves You Can Make in 2021

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2020 was as unpredictable as they come — a pandemic, economic meltdown, social upheaval and the most controversial election in recent memory.

Who knows what 2021 will bring? Will a nationwide vaccination campaign bring the COVID-19 pandemic under control? How much will the economy rebound? Will our elected governmental leaders put aside partisan differences and get the nation back on track?

There’s plenty, obviously, that’s out of our control. But you can control your money — how you spend, how you save, how you invest. Check out these ways to bolster your budget, build an emergency fund, manage spending and saving and more.

1. Refinance your mortgage

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Interest rates for a 30-year, fixed-rate mortgage set record lows more than a dozen times in 2020, and remain well under 3%.

Maybe it is time to refinance your mortgage to get a better rate. Moving from your higher rate to a lower one may seem to make perfect sense, but remember, there are fees. Our guidance: Don’t refinance unless you’ll stay in the home at least until you’ve saved more from the lower interest rate than you paid in refinancing fees.

Our Solutions Center lets you shop and compare mortgage refinance rates. The Consumer Financial Protection Bureau explains how to safely refinance your mortgage.

2. Shop for a higher return on savings

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Shop for a better interest rate on your savings at Money Talks News’ Solutions Center. There, rates currently offered can be as high as 0.85% and 0.70%.

3. Open an HSA

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A health savings account is a great way to help pay for medical expenses that your health insurance plan doesn’t cover.

You and possibly your employer can contribute pre-tax dollars to an HSA from which you can withdraw funds to spend on qualified medical expenses. Whatever money is not used rolls over to the following year (unlike a flexible spending account, or FSA).

We explain “3 Ways a Health Savings Account Can Improve Your Finances.” To be eligible you must be enrolled in a high-deductible health plan.

4. Create a budget and stick to it

seniors reviewing Medicare Advantage plans
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Are you flying blind with your money? You might be paying bills on time and socking away money into a 401(k). But aside from that, are you spending, buying with credit cards and just hoping there’s enough money left over at the end of the month?

Take control of the situation by using a household budget. It will help you keep track of expenses, investments, savings and spending. MoneyTalksNews recommends You Need a Budget (YNAB), a budget app that costs $12 monthly or $84 annually. You can try it free for 34 days and get a full refund if dissatisfied.

5. Find a side hustle

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Look for part-time jobs at Flexjobs and Fiverr, a freelancer marketplace. If you have expertise in a field, another route to adding income is to become a JustAnswer expert, delivering quick answers for readers in certain areas — computer electronics, homework, finance, heavy equipment and appliance and home improvement are a few.

MoneyTalksNews has tips on how to balance your full-time job with a side hustle.

6. Consolidate debt

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Owing money on credit cards is a tough psychological and financial burden. We have solid advice on how to start chipping away at it.

Money Talks News’ Solutions Center has more resources and help. You can find a credit counselor to help consolidate your debts into one monthly payment, drastically lowering interest rates and eliminating further penalties and fees.

You’ll also find help with tax debt and student loan debt.

7. Cut your spending on car insurance

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Have you checked recently to see if you can get a better rate on your vehicle insurance?

Shopping sounds like a painful bother, it’s true. But that’s changed recently. Comparison shopping for car insurance has become a lot easier with The Zebra, an insurance comparison site. The Zebra claims to deliver instant, real-time comparisons from 100 trusted insurance providers.

Learn more: “Find Cheaper Car Insurance in Just Minutes.”

8. Find and eliminate recurring charges

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It’s easy to add a new subscription service. But after a while it becomes part of the furniture and you don’t realize until months later that you’re spending money on something you don’t use a lot.

An app called Truebill can track down your subscriptions and cancel the ones you don’t use. The basic service is free.

Learn more: “This Tool Can Save You Hundreds on Recurring Costs.”

9. Find a cheaper internet or cable plan

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Everyone is online now, and providers are vying for your business. Just because you’ve been with a specific company for years doesn’t mean you’re married to them.

Shop around and find better deals. Also, negotiate with your current provider, try to bundle services and set up auto-pay. Your company may reduce your bill a good bit if you do.

10. Buy life insurance

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It’s never fun to contemplate death but if you have dependents or a family, life insurance may be crucial. Especially if you’re the primary breadwinner.

There is a variety of products, though. Which is right for you? In fact, life insurance is not necessarily for everyone. To clear up the confusion, Money Talks News founder Stacy Johnson discusses “Which Is Better: Term or Whole Life Insurance?

11. Invest in a smart device

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Technological innovation is so deeply integrated into our daily activities that we might as well use it to save money. A few ideas:

  • 5 Smart Home Devices That Are Definitely Worth the Money” tells how you can install a smart lighting system to control brightness, temperature and even color.
  • A smart thermostat, controllable by voice or phone, can save money by ensuring that your home is heated and cooled efficiently.
  • Programmable power strips that you can set to shut off devices at the source help lower energy bills.

12. Max out your 401(k)

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This tried-and-true retirement money booster improved in 2020, when the maximum yearly contribution increased $500 for a total of $19,500. There’s no increase this year. Still, that’s a lot of pre-tax income sheltered from Uncle Sam until you can begin withdrawals after age 59 ½.

If you are over 50, you can also set aside $6,500 in “catch-up” contributions, which the IRS lets older workers make to beef up their accounts.

Learn more: “Your Year-End Retirement Checklist: Prepare for a Great 2021 and Beyond.”

13. Build, boost your emergency fund

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The coronavirus pandemic taught many of us that having spare funds is essential to coping with job loss, hours reductions and other financial hits.

In “9 Tips for Starting an Emergency Fund Today,” we have advice on how to jumpstart your emergency account, including:

  • Selling some of your excess stuff
  • Taking overtime work at your job if it’s available
  • Saving (not spending) your tax refund

14. Update your W-4

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Taxpayers may have a shock if they find that the amount of their federal withholding isn’t enough to pay their IRS bill.

You can head off next year’s shock by adjusting your withholding allowances now. The IRS’ Tax Withholding Estimator helps you figure out how much to have your employer withhold from paychecks so it will be enough to cover your tax liability.

15. Create a net worth statement

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A statement of your net worth is a simple snapshot of where you stand financially at any moment and reveals your assets and liabilities.

A periodic refresh of your net worth statement shows if you are on the right track with retirement planning. The Balance explains how to do it. Or use a net worth calculator. Here’s one, at Nerdwallet.

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