Third Quarter Finance Tips to Turn Things Around

In mid-2024, Americans are still facing high inflation and high interest rates. 

And they are saving less and spending less. 

According to data from the Commerce Department, “The personal saving rate, the share of income that Americans are squirreling away, was 3.8% in January, well below the recent peak of 5.3% last May and the roughly 7% share before the pandemic.”¹

This makes sense, considering Americans entered 2024 with $17.3 million in household debt – the highest in the history of our country.²

Sadly, many Americans have not been saving enough in 2024 to cover themselves in the event of an emergency.

Forbes explains, “Americans spend, on average, $3,372 per month on essential expenses like housing, healthcare, food, transportation, and taxes. Unfortunately, the majority of survey respondents have less than this amount in savings—meaning if they had to rely on their savings in a time of emergency, they’d have a hard time making it through a single month.”³

Not only are Americans not saving, but they are also dipping into their retirement accounts.

A February 2024 Wells Fargo Money Survey found that “two-thirds (67%) of Americans say that they’ve cut back on spending, and almost half (45%) say they’ve put some life plans on hold. A third (35%) have dipped into their savings or investments.”⁴

People are making hard choices.

As we approach the second half of the year, now is the time to consider the following third quarter finance tips to turn things around. 

#1 Review Your Goals

third quarter finance

Take time to consider (and reconsider) your financial goals for 2024.

As we said, it’s been a doozy of a year already.

You may need to adjust your financial goals to keep of the still-high inflation and interest rates.

You may need to make hard choices about how you spend money to achieve your financial goals.

For example, this may have been the year you planned to build a solid emergency savings fund, but if you are still spending as you did in 2020, you may not have any money left over for savings.

Consider which of your financial goals are most important, and then devise a new strategy to get back on track for the next half of the year.

 

#2 Check Your Budget

third quarter finance

If you did not create a new budget for 2024, it’s time to do so.

2024’s grocery bills are higher than 2023. 

It is costing you more to pay for the essentials on your budget sheet.

Adjust your budget to reflect these inflation changes.

If you discover you do not have as much money left over after raising the budget for essentials, look for costs you can cut.

For instance, you may need to forego your gym membership and opt for using free YouTube workout videos. Instead of a Netflix subscription, you may need to visit the local library for free movies.

 

#3 Contribute More to Your 401(k)

third quarter finance

It’s tempting to contribute less when times are tough, but hold steady!

As you adjust your budget, make sure you continue to pay yourself first and prioritize your financial future.

You may not see the money today, but you will be thankful you have it in the future.

Whatever you do, make sure to contribute at least enough to get the company match.

 

#4 Rebalance Your 401(k)

third quarter finance

Another third quarter finance tip for turning things around is to rebalance your 401(k). 

This step doesn’t require you to save more or cut back, but it may help you boost your retirement savings.

Rebalancing your 401(k) account allocations may help you earn and keep more of your retirement savings. 

Because unmanaged allocations may experience much larger losses in down markets and may miss the opportunity for growth during good markets.

 

[Related Read: What Every Investor Needs to Know about Rebalancing a 401(k)]

 

#5 Build Up Your Savings

third quarter finance

If an emergency occurs, it may have devastating effects on your finances if you are unprepared.

In your revised budget, make sure you include a budget line for emergency savings.

Additionally, when you receive any extra money, such as bonuses, tax returns, or gifts, put it in your emergency savings fund.

Look for opportunities to earn extra money, such as selling used items or working a side hustle.

[Related Read: Close the Gap on Financial Goals with a Side Hustle]

 

#6 Plan for Fourth Quarter Now

third quarter finance

Third quarter finance typically involves summer spending – travel, vacations, and graduations.

But the spending doesn’t stop at the end of quarter three. 

The fourth quarter rings in the holiday season. 

Knowing the holiday season immediately follows Q3 should influence how you spend and save.

Now is the right time to add Christmas savings to your budget.

 

#7 Check Credit Reports

third quarter finance

According to the Federal Trade Commission, “Credit Card tops the list of identity theft types reported in 2023. The FTC received 416,582 reports from people who said their information was misused with an existing credit card or when applying for a new credit card.”⁵

When was the last time you reviewed your credit report?

Credit card fraud can happen to anyone, and you may not even realize it has happened to you unless you check.

In addition to checking your credit reports, another third quarter finance tip is to enroll in identity theft monitoring services.

 

#8 Review Insurance Policies

third quarter finance

Buying an insurance policy shouldn’t be a lifetime purchase. 

You want to review your insurance policies and shop around yearly to find the best rates for your current home, auto, and life insurance.

Things change from year to year. 

If you have made improvements to your home, your home insurance replacement value should reflect these improvements.

If your driving history has improved, you may be able to find a better price for car insurance.

If you have made positive health changes, you may be able to receive a lower price on life insurance.

 

#9 Deal with Debt

third quarter finance

It’s difficult to save for emergencies or invest in your future when you are chained to past purchases.

It’s important to make a plan to get out of debt.

Don’t keep putting it off and piling on more debt.

Make the third quarter the season you start lessening your debt load.

 

#10 Get Help from a Professional

third quarter finance

Once you’ve reviewed your goals, you have a better understanding of where you are and where you want to be.

What you may be struggling with is how to achieve those goals.

That’s where a financial advisor comes in.

It doesn’t matter if you are on track to meet your goals, struggling to pay off debt, or where you are in your retirement savings journey, a financial advisor can help.

When selecting a professional advisor, it’s important to work with an advisor who has a  fiduciary duty to you. 

A fiduciary is legally obligated to put your needs above his/her own and act in your best interest – ahead of any brokerage firm, investment provider, or company-provided representative.

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Sources

  1. https://www.marketwatch.com/guides/banking/financial-trends-2024/
  2. https://www.usatoday.com/story/money/2024/02/29/economy-saving-rate-recession-risk/72790561007/
  3. https://www.forbes.com/advisor/banking/living-paycheck-to-paycheck-statistics-2024/
  4. https://newsroom.wf.com/English/news-releases/news-release-details/2024/Two-thirds-of-Americans-have-decreased-spending-due-to-economy-Wells-Fargo-Money-Study-finds/default.aspx
  5. https://www.ftc.gov/system/files/ftc_gov/pdf/CSN-Annual-Data-Book-2023.pdf
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