Don’t let the holiday season distract you from your finances

Tax season can sneak up on people as the distraction of the holiday season reigns supreme. W9’s usually go out in January, and April 15 is the infamous day: All tax information is due to the IRS.

Kicking off 2020 with a distraction-free “set it and forget it” plan is what I’m sharing with you today:

Go paperless

Certain factors can change your tax situation from year to year, including starting a business, a change in income, divorce, a change in childcare, etc. If you had a change in circumstances this year, the stress of anticipation as you wait for your W2 form can be unpleasant. Many companies are now offering a paperless W2, which can minimize your wait time on important income forms. Check with your company to see what your options are to go paperless.

Create a savings account

Tax surprises are a great reason to have an emergency savings account at all times. Nobody ever wants to end up in a situation where you owe unexpectedly and aren’t prepared for it.

We recommend that you have at least $2,000 in your savings at all times, and a good goal is to work up towards three to six months of living expenses. Make 2020 the year you start an emergency savings, and you can even look into a challenge to keep it fun!

Itemize or standard deduction?

Tax breaks can come in many forms, and it’s good to know what they are before you get started so you can assemble a game plan. For example, many people don’t know you can’t take a dedication and itemize. Take some time to research what the better option would be for your financial situation.

Kat’s Money Corner is posted on Dollars & Sense every Tuesday. Kat Hnatyshyn, when not blogging or caring for her little ones, is a manager with CommunityAmerica Credit Union. For more financial chatter, visit http://communityamerica.com.