Jeffrey Campbell - January 2021

Jeffrey Campbell - January 2021

www.MayfieldHeightsCPA.com (440) 720-0959

January 2021

You CAN Achieve Your Goals! 4 Small Ways to Improve Your Finances This Year

If you’re like me, you’ve likely made a New Year’s resolution that sounded a bit like this: “This year, I’m going to stick with and achieve my goal. I’m really going to do it this year!” Chances are you reverted to your old habits after just a few weeks, and your resolution was a distant memory as life became busier and busier. We all promise to be better in the new year, but the unfortunate truth is that many of us fail to do so. Forbes reports that 80% of New Year’s resolutions fail, and by February, many of us have given up on our goals. I believe we can do better this year. That’s right: I believe there’s a way we can set New Year’s resolutions and actually achieve them. The secret, as many experts point out, is to find resolutions that are meaningful and identify the small steps you can take to get there. (The keyword there is small . Many people attempt goals that are too big!)

RESOLUTION 3: SAVE HERE AND SAVE THERE. After the holidays, if you’re looking at your bank account with a financial hangover, this is the challenge for you. The 52-week monthly challenge asks you to save a specific dollar amount once each week. For the first week of 2021, you just save $1. Place it in a jar or digitally save it in a savings account. Then, save $2 in week two. By week three, you save $3. This continues all the way through the last week of the year, week 52, upon which you place $52 in your jar. By that time, you will have $1,378 saved throughout the year! That’s the perfect balance to replenish what you spent over the holidays or to offer you a little extra spending cash. Make this challenge easier by setting a reminder on your phone and designating one day each week that you add to your savings. RESOLUTION 4: COMBINE RESOLUTIONS. If you want to eat better or give up smoking, combine it with your financial goals. For example, healthy eating is often easier at home, so swap out two takeout nights each month with a home-cooked meal! Get the whole family involved by finding recipes everyone can help make. You might find a few new family favorites, save a few bucks on takeout dinners, and lose some extra weight, too!

In 2021, try one of these small financial adjustments to help you achieve more financial freedom!

RESOLUTION 1: LEARN MORE. Do you know why you’re supposed to save at least 10% of your paycheck or what to look for when investing? If you don’t care, then move on to Resolution 2, but if you’re curious, this just might be the goal for you. Commit to learning more about your world of finance by adding financial podcasts, readings, or classes to your daily schedule. Listen to a podcast as you make breakfast or go for an evening walk and commit to reading up on the world of finance for 15 minutes each day. These little snippets can go a long way to increase your knowledge. RESOLUTION 2: AUDIT YOUR SPENDING HABITS. “Audit” is a scary term, but it can be quite beneficial. Set aside time each month to review your credit card statements or budget. Look for unnecessary expenses and things you can cut down your spending on. Look at subscriptions, websites you shop from frequently, and your biggest purchases. Cut out redundancies and look for ways you can save. The best part about this resolution is that it only requires about an hour of your time each month, and afterward, you’ll have a clearer idea of what steps to take to improve your finances.

Good luck with your goals this year, and remember — we’re cheering for you!

| 1 — Jeffrey Campbell (440) 720-0959

Out With the New, In With the Old! 4 Old-School Hobbies Making a Major Comeback

January is National Hobby Month — and for good reason! As people set goals for 2021, they’re also thinking about trying new hobbies. But with so many out there, picking just one can be a hobby in itself. Thanks in part to COVID-19, many people have rediscovered old-school hobbies. Some of these have been around for decades or even longer, and others have established communities that can rely on one another for support, sharing information, and more. Here are four great examples.

at home last year, they rediscovered their card collections and remembered how much fun they were. As a result, card sales went through the roof, and online card communities lit up with activity from all over the world. RESTORING CARS Car restoration is a hobby that lets you get your hands dirty, and it’s one that you can do with your kids or grandkids. It can be not only educational for them but also fun! Together, you can track down parts, talk to folks who are also interested in restoration, and learn about the history of your car. Though car restoration can be a bit costly and time consuming, it’s certainly a journey worth taking.

MAKING BREAD Over the last year, interest in this ancient hobby has skyrocketed. Homemade bread is tastier and more nutritious than store-bought, and it’s so satisfying to watch it come together. Not to mention it’s a great skill to have! With so many types of bread to try, you’re not going to run out of ideas any time soon.

EMBROIDERING Embroidery has taken off

because it’s both inexpensive and fairly easy to get into. Plus, many people have fallen in love with its meditative quality. One of the great things about embroidery is that you can use it to make amazing personalized gifts, like pillows, wall hangings, and kitchen towels!

COLLECTING CARDS No matter what people were into during the ’70s, ’80s, and ’90s, there was a trading card game for it. And even going into 2021, that tradition has been kept alive. When many people were stuck

New Tax Rules for Charitable Contributions in 2020 Don’t Forget the CARES Act’s Special Bonus!

DEDUCTIBLE CONTRIBUTIONS

Many people tackled deep-cleaning projects while spending more time at home last year. If your cleaning spree ended in donating items to a local charity, or if you donated funds to help local organizations supporting pandemic relief, you can look forward to some tax breaks! To feel confident in claiming them, here’s what you need to know about filing your 2020 taxes, including some unique additions from the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

If you choose to itemize your deductions, almost any gift to a qualified charitable organization can be deducted against your taxable income. It’s very important to keep records of all your contributions. According to the IRS, when donating items to a local charity like the Red Cross or Goodwill, the deductible value equals the fair market value of your items. If you made cash donations in 2020, there is a special rule to be aware of: Donations to public charities are now 100% deductible instead of 60%. However, this doesn’t apply to private foundations.

ITEMIZED VS. STANDARD DEDUCTIONS

When filing your taxes, you’ll need to first decide whether you want to itemize your deductions or take the standard deduction set by the IRS. Even those who cannot claim other tax credits or breaks qualify for the standard deduction. However, if you do have qualifying deductions and they add up to more than the standard deduction, it’s smarter to itemize your deductions. Take note that the standard deduction was increased in 2020 because of the CARES Act. In 2019, the standard deduction for a single person was $12,200; in 2020, it’s $12,400. For those who are married and filing jointly, the standard deduction was $24,400 in 2019 and $24,800 in 2020. And the standard deduction for heads of household in 2019 was $18,350 and it’s $18,650 in 2020.

AN ADDITIONAL CHARITABLE DEDUCTION

if you choose to take the standard deduction rather than itemize deductions on your 2020 tax return, you may qualify for a new dedication courtesy of the CARES Act. If you donated to a qualified charity before Jan. 1, 2021, you can deduct up to $300, for single filers, or $600 per married couple. The CARES Act can save you hundreds of dollars on your 2020 tax return. Use this guide to navigate the upcoming tax season. Happy filing!

2|

www.MayfieldHeightsCPA.com

Published by Newsletter Pro | www.NewsletterPro.com

TAKE A BREAK

This is the time of year when businesses would usually be looking at their budget and planning for the coming year. But COVID-19 has made the future entirely unpredictable, which makes properly planning your budget difficult. But all is not lost — there are some basic budgeting tactics you can implement to face 2021 with confidence. CREATE A FORECAST. If you’re not entirely confident in your ability to forecast sales for 2021, you’re not alone. But you do still have options. If 2020 went great, perhaps try setting your sights up 10% from last year. If you want to play it safe, keep your forecast on par with 2020. If even that doesn’t feel reliable, then jump back to 2019 and use it as a base for creating your budget. You can ramp up 10% or 20% from there. Don’t just forecast this year blindly — use >Page 1 Page 2 Page 3 Page 4

mayfieldheightscpa.com

Made with FlippingBook Ebook Creator