Kelan Combe, Program Coordinator, Empowering Financial Wellness For most people, investing can be a very daunting task. It can feel overwhelming to research different funds or investments, manage risk, and make sure your investments are diversified. However, there are investment options to help make this process simpler. One of these options is called a target-date fund.
Before I go on to explain what a target-date fund is, I want to clarify that we at Utah Money Matters are not financial advisors, and nothing in this article is intended to be specific investment advice. We do not recommend or endorse any specific investment. Our goal for this article is intended to be informational only, and we recommend that you do your own research, and/or speak to a financial advisor before making personal investment decisions. A target-date fund is a type of mutual fund, or a collection of different investments and investment types, that is made to grow for a specified period of time, for example, for the next 30 years until retirement. The purpose of a target-date fund is to automatically adjust investments and risk over time so that the closer you get to your target-date, the less risk your investments have. Think of it like a pilot guiding a plane into a runway. The closer they get to the runway, the more level and slower they have to make the plane so that it doesn’t crash into the runway. A target-date fund does this by shifting from higher-risk, higher-return assets to lower-risk, lower-return assets such as bonds as the target-date nears. Advantages of a Target-Date Fund
Target-date funds can be a valuable investment strategy for those looking for a convenient, hands-off approach to managing risk, but it is important to do the research to make sure you are comfortable with the risk and specific investments of the target-date funds you choose. For more information, check out this article from the Financial Industry Regulatory Authority (FINRA). You can also research specific target-date funds at https://tools.finra.org/fund_analyzer/ and https://finance.yahoo.com/.
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Rochelle Allen, Program Coordinator, Empowering Financial Wellness As parents, we all want our kids to grow up knowing the ropes when it comes to money. After all, teaching them early means we might not have to swoop in to save them from costly mishaps later on. The easy part is, we can sneak in money lessons every day, even during our regular routines.
When children are around 2 or 3, they're often excited to play "store" or "restaurant." Use this playtime to show them how money works by swapping pretend cash for goodies. Just keep an eye on those coins – they're a choking hazard. Once kids hit school age, get them involved in earning some cash, maybe through chores or a small allowance. Chat with them about saving up, sharing, and spending their money smartly. You can even use clear jars to show them their money growing each week and explain why we trust banks with our cash. As they get older, usually in the pre-teen era, it's time to dive into comparison shopping. Grab some store-brand and name-brand stuff and see if they can tell the difference. When they start buying things at school, like at a book fair or fundraiser, chat about budgeting and how their purchases can make a difference. Then, as the teen years roll around, it's all about helping them grasp household budgeting. This is when their money seems to vanish in a flash, so talk about what's a must-have versus a nice-to-have. Maybe even think about giving them a spending card to manage their funds. By weaving these money lessons into our daily lives, we're giving our kids the tools they need to handle their cash like champs. Teaching them about money isn't just about numbers – it's about setting them up for financial success in a world that's always changing. So let's jump on the chance to pass on these crucial skills to the next generation! Kelan Combe, Program Coordinator, Empowering Financial Wellness Let's not beat around the bush; Tracking expenses is not fun. There, I said what you were all thinking when you saw what this post was about. But despite that, tracking expenses is one of the essential parts of being in control of our finances. It can help you visualize where your money is going, and make sure you are spending it on the things that matter to you the most.
Perhaps you have tried tracking before but stopped after a while, or maybe you track your expenses sometimes, but it just takes too much time or is too hard to do consistently. No matter your relationship with tracking, there are always ways we can make it easier. Let me share some tips with you that have helped my colleagues, friends, and myself have more success with tracking expenses.
While tracking expenses might not be the highlight of your day, it's an incredibly important part of having control over our finances. While I hope these tips can be helpful, in the end, it's all about experimenting and finding what works for you. If you would like more tips on how to have control over your finances, check out our Weekly Webinar Series! Rochelle Allen, Program Coordinator, Empowering Financial Wellness Did you know that May 29th is National 529 Day? To celebrate, my529, Utah’s tax-advantaged college savings plan, is offering a fantastic limited-time deal: Open a new account between May 1st and May 31st, 2024, and receive up to $40 contributed to your account.
In a 2023 study on Trends in College Pricing and Student Aid by The College Board, findings revealed that recent high school graduates may encounter college debts as high as $37,000. Thus, the importance of saving for college has never been more pronounced. To better understand how a 529 account functions, let's explore it further and debunk some prevalent myths. Have you heard the myth that a 529 account can ONLY be used for college tuition? It's a common misconception, but it's false. Money in a 529 account can also cover qualified educational expenses such as room and board, books, computers, and internet. Plus, funds can be utilized tax-free for up to $10,000 for qualified K-12 expenses, registered apprenticeships, and technical colleges. And what if all the funds aren’t used for educational purposes? No problem! You have more options than ever. You can now roll money into a Roth IRA under certain circumstances. Younger sibling heading to college soon? Thinking about going back to school yourself? You can transfer funds to another eligible family member, including yourself! You can even maintain the account for future generations. These are the kind of leftovers you want! There are also fantastic tax advantages to a 529 plan. It may be eligible for state tax deductions, and earnings within the account grow tax-deferred. Withdrawals for qualified education expenses are tax-free at both federal and often state levels, boosting your savings. Additionally, there are advantages when it comes to the FAFSA. Funds held in a parent-owned 529 account are typically treated as parental assets on the FAFSA, reducing their impact on financial aid eligibility. If you think that 529 accounts aren’t flexible, think again. Choose from a range of investment options and use funds for qualified education expenses at any eligible institution nationwide. This flexibility empowers you to tailor your strategy and cover diverse educational needs. By starting early and making regular contributions, you can leverage the power of compounding to build a substantial fund for educational expenses. With no income limits or age restrictions, anyone can open and contribute to a 529 account on behalf of a beneficiary. 529 accounts offer a winning combination of tax advantages, flexibility, and control to help you achieve your education savings goals. Start saving with a 529 account today to secure your child's educational future and unlock a world of opportunities. By: Amanda Christensen, Utah State University Extension professor, Accredited Financial Counselor, Utah Money Moms editor April is National Financial Literacy Month, established in 2003 to teach Americans the importance of creating and maintaining healthy financial habits. During this month, individuals are encouraged to explore topics such as budgeting, saving, investing, and debt management.
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