It’s astounding to me that with all the finance and personal finance articles out there these days, many of us still remain largely uninformed regarding financial issues. It seems that just about every time I get on the internet, I’m inundated with a variety of money and financially-related articles on my homepage. And even though I’m reasonably well-informed about a variety of money issues, I still find that using these articles help me remain knowledgeable in an ever-changing business and investing world.
There are all sorts of ways we’ve increased our knowledge in the area of our personal finances. Two of the most important ways we do this include tracking our expenses and tracking our income. In these ways, we not only increase our knowledge regarding where we spend our money and how we earn it, but we better understand how it flows into and out of our coffers, in what amounts, and how these amounts change over time.
In this way, we can gauge not just our family’s financial progress, but we can determine a personal rate of inflation. This might not seem important, but with this number, we can better forecast through future value calculations how our expenses will grow over time and as we enter retirement, enabling us to compare costs to income.
Social Security could be one of the most important income streams we have in retirement. Therefore, knowing as much about it as possible can be critical to maximizing it when it counts.
Utilizing the Social Security Administration website can be a great way to get started in this area. Here you can sign up for a Social Security Statement that can provide information regarding benefits estimates, amounts paid into the system, and earnings records.
This information can in turn be used to begin determining what estimated benefits will be at certain retirement ages, whether benefits will be paid out at partial, full or even higher benefit levels depending upon the age of claimed benefits, and this can help determine a clearer retirement date.
Dealing with personal income taxes is not always the easiest of tasks. And while I’ve done my own taxes since I was a teen, it may not be realistic to ask everyone to attempt their own taxes each year, as they can become quite complicated depending upon the size and scope of family and finances. However, having an understanding of how your taxes are compiled and filed can help you understand how better to minimize them through things like deductions and credits, and also help you be on the lookout for certain eligible deductions and the documentation necessary for these deductions throughout the year.
While the best way to become better familiarized with your tax situation could be by doing your income taxes yourself, it’s not the only way. Consider attempting a practice run of your own tax filing before having a professional tackle it, or at least reviewing what a tax preparer has done and trying to understand it after he or she has finished. In this way, while you may not have a full comprehension of the tax code, you may at least have a better understanding of your financial situation and how to minimize your own tax liability.
More From This Contributor:
Building a Revenue Producing Blog
How I Differentiate My Blog
Preparing to Publish My First E-book
The author is not a licensed financial professional. The information provided in this article is for informational purposes only and does not constitute advice of any kind. Any action taken by the reader due to the information provided in this article is solely at the reader’s discretion.