One of the easiest ways to simplify your financial life is to automate it. With a little planning upfront, you can reduce the number of financial tasks on your to-do list, avoid missed payments, and create a system that works for you whether you’re working, approaching retirement, or already retired.

Here are a few ways to get started.

1. Put your monthly bills on autopilot

If you pay the same bills every month, why make yourself remember to pay them every month? Consider setting up automatic payments for recurring expenses such as:

• Mortgage or rent
• Utilities, internet, and cell phone
• Insurance premiums
• Student or auto loans
• Subscription services
• Other predictable monthly expenses

You can generally arrange automatic payments through the company you owe or through your bank’s online bill-pay service.

Money Tip: Whenever possible, schedule payments for a few days before the due date rather than on the last possible day. This gives you a little breathing room if a weekend, holiday, or processing delay gets in the way.

2. Automate a minimum balance payment on your credit card—but keep paying attention

Credit cards are another opportunity to simplify your finances. Setting up automatic payments for the minimum amount due can help prevent late charges and ding your credit score if you forget a due date or get busy with life.

If you’re paying down debt, you might automate a fixed amount that’s comfortably above the minimum.

Your credit card is the one place where it makes sense not to automate the full statement balance, in case you don’t have the cash available. You’ll still need to pay off your statement balance on a monthly basis. But it is also the best time to review your transactions. A quick monthly review can help you catch unauthorized charges, duplicate subscriptions, or spending that has quietly crept up.

Money Tip: I keep automatic payments enabled on my credit cards as a safety net in case I forget a payment. I also set reminders on my phone twice a month to make payments toward my balances. By paying down my credit card balances regularly, I keep my credit utilization low which can help improve my credit score.

3. Give irregular bills their own savings plan

Some expenses don’t arrive every month, but that doesn’t make them any less predictable. Think about property taxes, homeowners or auto insurance premiums, annual memberships, holiday spending, and routine home or vehicle maintenance items. You know what these amounts are and when they’re due, but these expenses can feel like financial surprises simply because they don’t appear on every monthly statement.

Instead of scrambling to cover them when they arrive, turn them into a monthly savings habit.

Here’s how it works:

1. Add up the irregular expenses you expect over the next year.
2. Divide that total by 12 to determine how much to set aside each month.
3. Arrange an automatic monthly transfer from checking into a dedicated savings account like a high yield savings account.
4. When a large bill comes due, transfer the money back to checking to cover it. And if you know it will be due on a particular day, set up the transfer back to your checking to land in your account a few days before it needs to be paid.

For example, suppose your annual property taxes are $12,000 and your homeowners insurance costs $2,400 per year. Together, those expenses total $14,400 annually.

That’s $1,200 per month to set aside. Instead of facing a $14,400 bill over the course of the year, you’re building up the money gradually.

Best to keep this money in a dedicated savings account. The important thing is to distinguish money reserved for upcoming expenses from money available for everyday spending. If you’re starting from zero, remember that your savings account will need time to build up. You may need an initial deposit or a temporary higher monthly contribution before the system is fully funded.

4. Build a system that pays you in retirement

Automation isn’t just for people with paychecks. In fact, it can be especially useful in retirement.

When you’re working, your employer may deposit money into your checking account every two weeks. You use that money to pay bills, buy groceries, and enjoy life. You probably don’t spend much time thinking about how the money gets there.

In retirement, however, income may come from several different sources: Social Security, a pension, investment accounts, interest, dividends, or required minimum distributions (RMDs). Social Security and pensions arrive monthly, but you need to plan for the rest to line up with your monthly expenses.

One way to simplify things is to create your own retirement paycheck. Here, you can arrange for a consistent amount of money to flow into your checking account on a schedule that works for you.

For example, you might:

• Have Social Security or pension payments deposited directly into checking.
• Arrange a monthly transfer from your investment or retirement account to cover the rest of your planned spending.
• Set up one or two transfers each month—perhaps on the 1st and 15th—to mimic the rhythm of a traditional paycheck.
• Keep a cash reserve in checking or savings to cover timing differences between incoming payments and outgoing bills.

Imagine that your retirement plan supports $8,000 per month in spending, including the income already provided by Social Security and a pension. If those sources provide $5,000 per month, you might arrange for the remaining $3,000 to be transferred from your designated investment or cash savings account.

You could receive that $3,000 as one monthly transfer or split it into two $1,500 transfers. The right approach depends on your bill schedule, spending habits, and overall financial plan.

The benefit isn’t just convenience. A predictable deposit can make it easier to manage day-to-day spending and help retirement feel more familiar.

Make your retirement paycheck work with your plan

Before automating retirement withdrawals, consider a few important details:

• Coordinate with your overall withdrawal strategy. The amount and timing of transfers should reflect your spending plan, investment allocation, taxes, and other income sources.
• Keep enough cash available. Make sure the account funding your transfers has sufficient money, and establish a plan for replenishing it. A modest cash cushion is a good idea.
• Account for taxes. Depending on the account and distribution, you may need to arrange federal and state tax withholding or make estimated tax payments. In fact, tax withholdings on Social Security, pensions and RMDs can help you avoid a large tax bill surprise come tax time!
• Coordinate RMDs. If you’re subject to required minimum distributions, make sure your withdrawal schedule satisfies the applicable rules. An automated monthly paycheck doesn’t automatically guarantee that your annual RMD requirement is met. Your RMD amount changes year to year, so you’ll need to adjust the monthly transfer annually.
• Review the plan periodically. Spending, investment values, and tax circumstances change. Your retirement paycheck should be revisited as your needs evolve. And when you’ve already done the work of setting this up, you only need to review to make sure it is still working smoothly.

5. Make automation work for you, not against you

Automation is powerful, but it works best when you build in a few simple safeguards.

• Start with a cash-flow calendar.List your expected income deposits, automatic transfers, and bill-payment dates. You don’t need an elaborate spreadsheet—just enough information to see when money comes in and when it goes out.
• Leave a cushion in checking.A small buffer can help protect you from overdrafts when a bill changes or a deposit arrives later than expected. The appropriate amount depends on your cash flow and comfort level.
• Review your accounts once a month.Set aside 10–15 minutes to confirm that payments went through, transfers occurred as expected, and your balances look right. Automation should reduce the work, not eliminate oversight. Better yet, make it a money date. Put it on the calendar, pour a cup of coffee or a glass of wine, and if you share finances with a partner, sit down together. Look at what came in, what went out, and what’s coming up next month, then celebrate one thing that went right. Anna, our owner, wrote about how the Money Date was born, and the idea is the same here: when the check-in feels like something to look forward to, it’s a lot easier to keep doing.
• Be thoughtful about variable bills.Utility bills, credit card balances or minimums, and some insurance premiums can fluctuate. Make sure your automatic payment settings account for those changes.
• Revisit your system annually.Review subscriptions, insurance premiums, tax bills, savings targets, and retirement withdrawals. Update the amounts as your life changes.
• Protect yourself from overdrafts and fraud.Understand your bank’s overdraft settings, use account alerts, and enable multifactor authentication where available. Automatic payments should be set up through trusted websites or financial institutions.

6. Start small—then let the system do the work

You don’t need to automate everything in one afternoon. Start with one or two changes that would make the biggest difference in your life.

Maybe it’s setting your credit card to pay the statement minimum balance automatically to give you the confidence you’ll never miss a payment. Maybe it’s establishing a monthly transfer to save for property taxes. Or maybe you’re retired and ready to replace a collection of irregular withdrawals with a predictable monthly deposit.

Once those pieces are in place, add another.

A good financial system doesn’t require constant attention. It creates a reliable structure that helps your money move in the right direction, while still giving you the flexibility to make thoughtful decisions when life changes. The goal isn’t to spend more time managing your automation. It’s to spend less time thinking about routine financial tasks and more time focusing on what matters to you.

The post Live Easier: Automate the Boring Stuff appeared first on MainStreet Financial Planning.

Recently, my refrigerator stopped working. It was one of those expenses that wasn’t on the calendar, wasn’t in the budget, and certainly wasn’t something I was excited to spend money on. But appliances don’t pay much attention to our financial plans. Eventually, something breaks, needs to be repaired, or needs to be replaced.

That experience was a good reminder of one of the simplest—and most important—principles of financial planning: Financial security isn’t about preventing unexpected expenses. It’s about being prepared when they happen.

Two financial tools can be particularly helpful: an emergency fund for the things we don’t expect and a splurge account for the things we do want. They serve very different purposes, but both can make your financial life more resilient.

Your Emergency Fund: Preparing for the Unexpected

An emergency fund is money set aside for expenses that are necessary, unexpected, and difficult to predict. A broken refrigerator is a good example.

Other examples might include:

• An unexpected car repair
• A broken water heater or HVAC system
• A major home repair
• An insurance deductible
• An unexpected medical or dental expense
• A temporary interruption in income
• An emergency trip to help a family member

We don’t know exactly when these things will happen, but we know they are likely to happen eventually. A refrigerator breaking could have used dollars in a Home Maintenance Fund if the event was foreseeable. But it was a 2019 model and should have had plenty of years left. But it became a financial emergency when there wasn’t enough money available to deal with it. And if we’ve talked over the last 8 months, you’ll know why my Home Maintenance fund has been exhausted!

An emergency fund changes that equation.

Instead of not being able to pay off the credit card for a repair or taking money away from another financial goal, you can use money that was specifically set aside for situations like this.

The refrigerator is still broken. The expense is still annoying. But it doesn’t have to derail the rest of your financial plan.

Saving Is Harder Than It Sounds

“Just save three to six months of expenses” is easy advice to give, but actually doing it can be much harder. We give our clients these targets, but also understand that housing, food, insurance, healthcare, transportation and other everyday expenses have all put pressure on household budgets. For many people, there simply isn’t a large amount of money left over at the end of each month.

To illustrate the challenge, Bankrate’s 2026 Emergency Savings Report found that only 30% of Americans would use savings to pay for a $1,000 emergency expense. Overall, just 47% reported having sufficient liquidity or access to funds to cover a $1,000 emergency expense.

That is a good reminder that difficulty saving isn’t necessarily a matter of poor financial discipline. For many households, the math is genuinely difficult.

How Much Is Enough?

There isn’t one magic number that works for everyone. A common guideline is to maintain three to six months of essential living expenses, but your appropriate emergency reserve depends on factors such as:

• Stability of your income
• Whether you are single or part of a dual-income household
• Your employment situation
• The amount of debt you carry
• Your insurance coverage
• Your home and vehicle
• Whether you have dependents
• Other resources available to you

For someone who currently has very little saved, the goal doesn’t have to be “save three months of expenses immediately.” Start smaller. More importantly…start.

Think in stages:

• First goal: Build a starter emergency fund, perhaps $500–$1,000.
• Next goal: Build enough to handle a larger unexpected expense without relying on credit.
• Longer-term goal: Work toward an emergency reserve that provides several months of essential expenses, based on your individual circumstances.

And remember: using your emergency fund doesn’t mean you failed. As I’ve said before, “this is the emergency you’ve been saving for!” so there’s nothing wrong at all when you’re using it for exactly what the account was designed to do.

Then once the immediate problem is solved, you can focus on rebuilding the balance.

The Case for a Splurge Account

And then there is another pool of savings that deserves more attention than it sometimes receives: Fun!

A financial plan can become overly focused on everything we should be doing with our money: Save for retirement, pay down debt, build an emergency fund, pay taxes, invest…

Those things are important. But life is happening today, too. That’s where a splurge account can be useful. A splurge account is simply money that you deliberately set aside for something enjoyable. Think of it like an ‘emergency’ fun thing that suddenly came up.

Why a Splurge Account Can Make Budgeting Easier

Imagine that every dollar of your monthly income has already been allocated to expenses, savings and financial goals.

Then a friend invites you to birthday dinner at a restaurant that is more expensive than you would normally choose. Would you say no because it isn’t in the budget, or put it on a credit card and worry about how you’ll pay for it later? Instead, if you have a splurge account, you can simply say to yourself: “I’ve already saved for this kind of thing.” That’s a very different feeling.

Suppose after you’ve allocated for your expenses, savings goals and investments there is $25 or $50 left at the end of the month for you to put into a separate account for fun. After several months, you might have a few hundred dollars available.

Then you see Rick Springfield will be performing, and you know you and your friend have to go!

You haven’t raided your emergency fund.

You haven’t reduced your retirement contribution.

You haven’t created credit-card debt.

You haven’t “blown your budget.”

You followed your budget.

The money was specifically set aside for enjoyment. More specifically, it was to finally see Rick Springfield after his pandemic-era concert was canceled. More on the show below.

A Good Financial Plan Makes Room for Enjoyment

There is a psychological benefit to this approach as well. If a financial plan tells you that you should never spend money on anything unnecessary, it can eventually feel restrictive. And restrictive plans aren’t always sustainable.

A better approach is to recognize that financial planning is about more than maximizing how much you save. It is about making intentional choices about how you use your resources—both today and in the future.

Your emergency fund provides protection.

Your retirement savings provide for the future.

Your goal-based savings help you accomplish specific objectives.

And your splurge account gives you permission to enjoy some of your money along the way.

And Now Back to Rick

I first discussed splurge accounts 6 years ago when I was devastated that, due to the pandemic, my VIP, front row seats to see Rick Springfield were canceled.

On February 7^th 2020, I wrote The Unintentional Splurge (And What To Do Next) which documented the process of coming up with funds for tickets and my excitement about seeing this show. At that time, I called some extra cash a ‘slush fund’ and made some budgetary sacrifices in order to stay on track with my other savings goals.

Then came the pandemic and August 3^rd, 2020’s article Things Don’t Always Go As Planned. As expected, the entire show was later canceled, not just Rick Springfield. At that time, I created the Splurge Account with the refunded money, and did my best to be optimistic.

I had a right to be optimistic–I finally got my amazing show. This is what happened:

I bought tickets in row E. Not front row, but really quite close. He played all the hits and some newer music—fantastic! During the song Human Touch, Rick Springfield goes out into the audience. He typically does this. He was stepping on the armrest and hopping over seats, and as he was zigzagging up the first several rows, he ended up stopping right in front of me and my friend, Windee! Everyone else was reaching out to touch him (the song was Human Touch, after all), he even leaned over to take a selfie with the girl next to me. I was dazzled that Rick Springfield was literally right in front of me! I saw Windee reach out so I reached out my hand as well, and he grabbed my hand to balance himself as he turned to walk on the armrests down the row. But before he moved forward, he swayed back a bit, losing his balance a little for just a split second. I felt his grip on my hand got tighter.

At that point I grabbed his arm with my other hand to steady him. I was so worried that the 76-year-old Rick Springfield was going to fall directly in front of me, and I definitely didn’t want to be responsible for not keeping him safe! What seemed like minutes of sheer panic for me was really only seconds. He steadied himself and kept singing without skipping a beat. He hopped down the rest of the row, got off of the chairs in the aisle, looped around and made his way back to the stage.

Windee turned to me and asked, ‘Are you all right?’ I’m fairly certain I just looked stunned. I responded to her ‘What just happened?’

It had been six years exactly since the front row meet-and-greet tickets with Rick Springfield were canceled due to the pandemic. I think this made up for it.

The post Emergency Funds, Splurge Accounts and the Epilogue of the Rick Springfield Saga appeared first on MainStreet Financial Planning.

When:
June 5th, 2026
3:00 pm Eastern; 12:00 pm Pacific
~45 minutes & Q/A included

How: Zoom Meeting
Recorded and able to retrieve for one week

Cost: Free to ongoing clients; $10 per session for guests

Email us for the recording!

Bridging the Gap to Medicare: Health Insurance Strategies for Early Retirement

Hosted by: Cynthia Flannigan, CFP®

Guest commentator: Matt Allen
Founder, Iconic Insurance

Thinking about retiring before age 65? One of the biggest challenges early retirees face is navigating health insurance before Medicare begins. Join us for a practical conversation with Matt Allen, Founder of Iconic Insurance, as we break down ACA plans, COBRA, tax credits, private insurance options, and smart strategies to help manage healthcare costs and retire with more confidence.

Matt Allen is the Founder at Iconic Insurance, where he specializes in helping and educating self-employed individuals, small business owners, and early retirees navigate the complexities of health insurance. With over a decade of experience, Matt has developed a deep understanding of the challenges that come with securing health insurance coverage outside of employer-sponsored plans.

Iconic Insurance Mission Statement: “We empower people to confidently navigate the healthcare system.”

Some of the topics we’ll discuss:

• Understanding ACA marketplace plans and subsidies
• How COBRA works and when it makes sense
• Private insurance alternatives before Medicare
• Strategies to manage healthcare costs in early retirement
• Tax credit opportunities and income planning considerations
• Common mistakes early retirees make with health insurance

Disclaimer: This is a broad group session and certain strategies may or may not be appropriate for specific situations. MainStreet makes no claim that all member posted information is accurate or should be acted upon without professional and individual financial planning, tax and/or legal advice.

The post Chalk Talk: Bridging the Gap to Medicare: Health Insurance Strategies for Early Retirement appeared first on MainStreet Financial Planning.

Why Consider a Roth IRA Conversion?
• Tax-free growth – Your investments can grow without future tax burdens.
• Tax-free withdrawals – You and your heirs can enjoy tax-free distributions in retirement.
• No required minimum distributions (RMDs) – Unlike Traditional IRAs, Roth IRAs do not require withdrawals during your lifetime.

Key Considerations Before Converting

Do you need these funds within the next 5 years?
• Withdrawals of converted funds within five years may be subject to taxes and penalties. If you’ll need access to the money soon, this may not be the best option.

Will the conversion push you into a higher tax bracket?
• The amount converted is taxed as ordinary income. A large conversion could push you into a higher tax bracket. To manage this, consider converting smaller amounts over several years.

How will you pay the taxes on the conversion?
• Using cash from outside your IRA to pay the tax bill helps maximize tax-free growth.
• If you use IRA funds to cover taxes, your investment balance shrinks.

Will your tax rate be higher now or in the future?
• If you expect to be in a higher tax bracket later, converting now at a lower rate may save money in the long run.
• If your current tax rate is higher than your expected future rate, conversion may be less beneficial—unless you have a long time horizon for growth.

Who is your Roth IRA for?
• If you don’t anticipate needing these funds for your own lifestyle, a Roth IRA conversion can be earmarked for the next generation, allowing up to 10 additional years for tax-free growth.
• However, this remains your asset first and can support your needs if circumstances change.

Final Thought: No Do-Overs
Once you complete a Roth IRA conversion, it cannot be reversed. You must pay taxes on the converted amount in the year of the conversion.

A Roth conversion isn’t inherently “good” or “bad”—it’s a timing decision. The right answer depends on your current tax situation, future expectations, and how this move fits alongside the rest of your financial plan. Thoughtful planning, often done over multiple years, can turn this into a powerful tool rather than an expensive mistake.

The post Basics of a Roth IRA Conversion appeared first on MainStreet Financial Planning.

When:
March 25th, 2026
3:00 pm Eastern; 12:00 pm Pacific
~45 minutes & Q/A included

How: Zoom Meeting
Recorded and able to retrieve for one week

Cost: Free to ongoing clients; $10 per session for guests

Email us for the recording!

Buying Your Next Home Before You Sell

Hosted by: Cynthia Flannigan, CFP®

Guest commentator: Lee Chieng

Certified Mortgage Advisor, General Mortgage Capital Corp

This Chalk Talk is designed for homeowners who are preparing for an important life transition: selling a long-time family home and purchasing a new home for the next chapter of retirement. But timing can be tricky. What happens if you find the perfect downsized home before your current home sells? Or if you want to avoid making your purchase contingent on selling first?

In this session, we’ll walk through:

1. What are the common obstacles homebuyers are facing when they decide to buy before they sell?
2. What are the financing options available?
   • Bridge loan
   • Equity line or equity loan
   • Pledged assets
3. The costs, timelines, and qualification requirements for each option
4. The advantages and potential risks to consider

Lee Chieng is an accomplished loan officer with a strong background in the mortgage industry. With over two decades of experience, she has been assisting clients in achieving their homeownership dreams since 2002. Lee possesses extensive knowledge of both traditional and non-traditional home mortgages, as well as expertise in government-backed loans such as FHA and VA.

In addition to her expertise in traditional, conventional, and government loans, Lee is well-versed in catering to the unique needs of investors and individuals with non-traditional income sources. She understands that not all borrowers fit the standard criteria and is proud to offer Non-QM loan programs tailored specifically for these situations. Lee is committed to providing options and solutions to clients who may have faced financial challenges in the past or have unconventional financial profiles.

Furthermore, Lee is highly knowledgeable in the complexities of reverse mortgages. She understands that homeowners in their golden years may have different financial needs and can benefit from a reverse mortgage. Lee’s reverse mortgage program is designed to provide financial flexibility and stability for seniors aged 62 and older. Whether her clients are looking to supplement their retirement income, cover healthcare expenses, or simply enjoy their retirement years to the fullest, she offers tailored solutions to meet their specific needs. Lee takes the time to educate her clients about the pros and cons of reverse mortgages, ensuring they have a comprehensive understanding of this specialized financial product.

Throughout her career, Lee has helped numerous clients with diverse backgrounds and unique circumstances achieve their homeownership goals. She believes in building trust and lasting relationships with her clients, always putting their best interests first. Lee’s commitment to providing exceptional service means that she goes the extra mile to educate her clients about the various options available to them. Her goal is to empower her clients to make informed choices that align with their financial objectives.

You may contact Lee at 415-569-2119 or by e-mail at lchieng@gmccloan.com to learn more!

The post Chalk Talk: Buying Your Next Home Before You Sell appeared first on MainStreet Financial Planning.

• Transfer cash held in digital wallets like Venmo, PayPal and Cash App to your bank account monthly.
  • Benefit: Funds held in these apps are not FDIC insured. Moving them protects your money—and allows it to earn interest.
• Vacuum out your dryer vent at least annually.
  • Benefit: Your dryer runs more efficiently, and more importantly, you significantly reduce the risk of a house fire.
• Make a credit card payment twice a month.
  • Benefit: Your credit score could increase by lowering your credit utilization rate before the lender reports your balance to the credit bureaus.
• Take photos of your ID, passport, and credit cards and store them in a hidden folder on your phone.
  • Benefit: If items are lost or stolen, you’ll have quick access to important details and customer service numbers securely stored in a password-protected Hidden/Locked/Secure folder.
• Write a postcard to a friend you haven’t spoken to in a while. A stamp for the standard domestic postcard (4 ¼” high by 6” long) costs $0.61.
  • Benefit: Staying socially connected can reduce loneliness and positively impact your long-term health and happiness!

At the end of the day, progress doesn’t come from grand resets—it comes from small, repeatable choices that quietly stack in your favor. Whether it’s reconnecting with someone you care about, protecting your money, improving your safety, or strengthening your financial footing, these simple to-dos are easy to overlook but powerful when practiced consistently.  If your New Year’s intentions wobbled a bit, that’s okay—consider this your reminder that a reboot is always available, and even the smallest habits can make a meaningful difference over time.

Related reading:

Good Habits Need Good Techniques — a practical look at how to build habits that actually last.

The post Good Habits for the New Year appeared first on MainStreet Financial Planning.

Here’s what you need to know to avoid Medicare late enrollment penalties while continuing to work past age 65.

Understanding Medicare Parts and Potential Penalties

Medicare consists of several parts, and not all of them are mandatory at age 65. But delaying enrollment in certain parts without proper coverage can result in permanent financial penalties.

Do You Need to Enroll in Medicare at Age 65?

That depends on your current health insurance:

• If your employer (or your spouse’s) has 20 or more employees, and you’re actively working, you can delay enrolling in Medicare Part B and D without penalty. The employer’s plan is considered creditable coverage, meaning it meets Medicare’s standards.
• If the employer has fewer than 20 employees, you generally must enroll in Medicare when you turn 65. In this case, Medicare becomes your primary insurance, and delaying could lead to gaps in coverage and penalties.

When You Retire: Use the Special Enrollment Period (SEP)

Once you stop working or lose employer coverage (whichever happens first), you enter what Medicare calls a Special Enrollment Period. This allows you to sign up for Medicare without facing penalties.

• You have 8 months to enroll in Part B after your employment or group coverage ends.
• You have 63 days to enroll in Part D after your drug coverage ends.

Failing to enroll within these windows can trigger the penalties listed above.

Key Steps to Avoid Penalties

1. Confirm Your Employer Coverage Is Creditable
   Talk to your HR or benefits administrator to confirm whether your current plan counts as creditable coverage for Medicare Parts B and D.

• Creditable coveragemeans the employer health plan is at least as good as Medicare.
• If your current employer coverageis creditable, you may be able to delay enrolling in Medicare Part B and/or Part D without penalties.
• If it’snot creditable, you need to enroll in Medicare when first eligible to avoid penalties and coverage gaps.

1. Gather the Required Paperwork
   When you retire and apply for Medicare Part B, you’ll need to submit Form CMS-L564 (Request for Employment Information), signed by your employer. This proves you had coverage and qualifies you for penalty-free late enrollment.
2. Time Your Enrollment Carefully
   Enroll during your Special Enrollment Period instead of using the General Enrollment Period (January 1–March 31), which may result in a coverage gap and penalties. Also, COBRA isn’t considered group health plan coverage, so again, use the Special Enrollment Period!

Should You Enroll in Medicare Part A at 65?

Many people enroll in Medicare Part A at 65, even while working, because:

• It’s free if you or your spouse worked and paid Medicare taxes for at least 10 years.
• It can serve as secondary insurance to your employer plan.

However, if you have a Health Savings Account (HSA) and want to continue contributing to it, do not enroll in any part of Medicare, including Part A. Once you enroll, you can no longer contribute to your HSA.

Working past 65 doesn’t mean you’ll be penalized by Medicare — but it does require some proactive planning. By understanding your coverage, and acting during the correct enrollment windows, you can avoid costly mistakes and ensure a smooth transition when you’re ready to retire.

Go to www.medicare.gov for more information and download the Medicare and You handbook. These resources can answer many of your questions about enrolling for Medicare.

The post How to Avoid Medicare Penalties When Working Past 65 appeared first on MainStreet Financial Planning.

Inflation – The rate at which prices for goods and services rise, decreasing purchasing power. Moderate inflation is normal, but high inflation can be problematic.

An example of inflation is the U.S. inflation surge in 2021-2022 following the COVID-19 pandemic. During this period:

• Prices of goods and services rose rapidly, with inflation peaking at 9.1% in June 2022, the highest in over 40 years.
• Supply chain disruptions from the pandemic led to shortages, increasing costs for goods like cars, electronics, and food.
• Government stimulus programs and low interest rates boosted consumer demand, adding to price pressures.
• Energy prices soared due to geopolitical factors, including the Russia-Ukraine war, making transportation and heating more expensive.

The Federal Reserve responded by raising interest rates aggressively to slow inflation, eventually bringing it down in 2023.

Deflation – A decrease in the general price level of goods and services, often indicating weak demand and economic trouble.

An example of deflation is the Great Depression (1929–1939) in the United States. During this period:

• Prices of goods and services fell significantly.
• Wages declined, leading to lower consumer spending.
• Businesses reduced production and laid off workers.
• The money supply contracted due to bank failures, reducing available credit.

Deflation is dangerous because it can lead to a downward economic spiral where people delay purchases expecting lower prices, further reducing demand and slowing economic growth.

Disinflation refers to a slowdown in the rate of inflation, meaning prices are still rising, but at a slower pace than before. It’s different from deflation, which is when prices actually drop.

An example of disinflation is the U.S. economy in the early 1980s under Federal Reserve Chairman Paul Volcker. During this period:

• Inflation was high in the late 1970s, exceeding 10% annually due to oil price shocks and loose monetary policy.
• The Federal Reserve raised interest rates aggressively, peaking at around 20% in 1981, to slow inflation.
• Inflation gradually declined from over 10% in 1981 to around 3-4% by 1983, but prices still increased—just at a slower rate.
• Economic growth slowed briefly, leading to a recession (1981-1982), but inflation was successfully controlled.

This period is a classic example of disinflation because inflation was reduced without turning into deflation (where prices actually decrease).

Stagflation – A rare combination of stagnant economic growth, high unemployment, and high inflation.

An example of stagflation is the 1970s oil crisis in the United States. During this period:

• High inflation: Oil prices surged due to OPEC’s oil embargo (1973), leading to increased costs for goods and services.
• High unemployment: Economic growth slowed, and businesses struggled, leading to job losses.
• Stagnant economic growth: Despite rising prices, GDP growth was weak, creating an unusual combination of inflation and recession

Stagnation – A prolonged period of slow or no economic growth, often with high unemployment.

An example of stagnation is Japan’s “Lost Decade” (1990s-2000s). During this period:

• Economic growth was sluggish: Japan’s GDP growth was minimal despite various government stimulus efforts.
• Low consumer and business confidence: People and companies were hesitant to spend or invest.
• High debt levels: The banking system was burdened with bad loans from the burst of Japan’s 1980s asset bubble.
• Mild deflation: Prices remained stagnant or slightly declined, discouraging spending and investment.

This stagnation persisted for years, leading to prolonged economic weakness despite low interest rates and government intervention.

These terms can be quite similar, so I hope this list helps clarify their meanings and enhances your understanding of the articles you read.

The post What is Inflation, Deflation, Disinflation, Stagflation and Stagnation? appeared first on MainStreet Financial Planning.

1. Freeze Your Credit

If you temporarily unfreezed your credit for a loan or new credit card last year, be sure to re-freeze it now. Freezing your credit is an effective way to protect against identity theft and unauthorized access to your financial accounts.

2. Update Your Home Inventory

Take a few moments to review and update your home inventory, whether you keep it in an app, a spreadsheet, or through photos on your phone. Removing items you no longer own and adding new purchases will ensure your inventory is accurate and ready for insurance purposes if needed.

3. Scrutinize Your Credit Report

Visit annualcreditreport.com to get your free credit reports from the three bureaus: Experian, TransUnion, and Equifax. Verify that the information is accurate and that all your credit cards, store accounts, and loans are properly listed. This will help catch any errors or fraudulent activity. If you notice discrepancies, file a dispute with the relevant credit bureau.

4. Verify Your Social Security Earnings

Your Social Security benefits are based on your earnings record, so it’s crucial to ensure your reported income is correct. Log into myssa.gov to view and confirm your earnings history. If you notice any errors, you can easily request a correction online. For 2024, the maximum taxable earnings subject to Social Security tax is $168,600. Double-checking this annually ensures your record stays accurate for future benefit calculations.

5. Review Your Estate Planning Documents

Take some time to review the key documents in your estate plan, such as your will, power of attorney, and property deeds. Whether they’re stored in physical files or securely stored digitally, it’s important to confirm they’re updated and easy to access should you need them.

6. Revise Your Annual Budget

Look over your budget from the previous year and make adjustments for 2024. Tools like Tiller, Monarch, or YNAB can help you track your spending and ensure you stay within your financial goals. While inflation can increase certain costs, staying aware of your spending is the key to preventing your expenses from creeping up.

7. Prepare for Tax Season

Organize your tax documents in one central location—whether it’s a folder, box, or basket—to avoid scrambling when it’s time to file. You’ll receive a mix of mailed forms, emailed notices, and online documents, so keeping everything in one place will save you time and hassle when tax season arrives.

By checking these key items annually, you’ll stay on top of your financial health and be ready for whatever the year brings. Starting the year with these updates will give you peace of mind, knowing your finances are secure and organized.

The post Start the Year Strong: Get Your Financials in Shape for 2025 appeared first on MainStreet Financial Planning.

Median emergency savings: $600

An Empower study shows Americans have accumulated a median emergency savings of just $600. This varies by age with older individuals saving more.

• Gen Z median savings $200
• Millennials median savings $500
• Gen Xers have median savings $868
• Baby Boomers median savings $1,000

Average credit score in the US: 715

While credit scores tend to be higher for older individuals, according to Experian, the average score in 2023 is 715 which is considered Good credit.

• Poor credit: 300 to 579
• Fair credit: 580 to 669
• Good credit: 670 to 739
• Very good credit: 740 to 799
• Excellent credit: 800 to 850

Retirement savings at age 67: 10x income

Fidelity estimates that you need to save 10 times your income by age 67 to maintain your current lifestyle in retirement.

Fidelity’s guideline:

• Age 30 1x salary
• Age 40 3x salary
• Age 50 6x salary
• Age 60 8x salary

Note that the success of these estimates actually depends on how much you spend as well as factoring in your other income sources.

401(k) account contribution: 8.0% 

In 2023, Capitalize found the average employee-only contribution was 8%; the average dollar amount of employee-only contributions of $5,993.

Average net worth: $1.06 million

The Federal Reserve 2022 Survey of Consumer Finances report found that the average net worth among all households was $1.06 million among U.S. families.

• Ages 18-34, net worth $183.380
• Ages 35-44, net worth $548,070
• Ages 45-54, net worth $971,270
• Ages 55-64, net worth $1.56 million
• Ages 65-74, net worth $1.78 million
• Ages 75+, net worth $1.62 million

Percentage of Americans with a Will: 32%

Caring.com’s 2024 Wills Survey indicates that only 32% of people in America have a will. This is 6% fewer than in 2023

How did you do? Comparing your financial situation to national averages can provide insight into where you stand, but these are not benchmarks or guidelines of where you should be, just where others are. Your personal goals, values, and circumstances play a much larger role in shaping your financial journey. Rather than focusing solely on how you measure up to others, use these averages as a tool to identify areas for improvement or growth. Ultimately, success in personal finance is about creating a plan that works for you and continually adjusting it to meet your evolving needs and aspirations.

The post How Do You Compare to National Averages? appeared first on MainStreet Financial Planning.