Good morning, money nerds!

It's Tuesday today, a great day to...

T rack your spending 🧮
U pdate your budget 📝
E at homemade meals 🍳
S tart a fun side hustle 💸
D eclutter your workspace 🏠
A utomate your investments 📉
Y OLO baby!!! 😱

(Oops, skip that last one! — I couldn’t think of a good money-related point for the letter Y.)

I'll keep brainstorming. But in the meantime, here's this week's highlights and happenings 👇👇👇

TO DO

Create a Positivity Jar 🫙🤩

Step 1: Grab an empty jar or vase. Put it in the middle of your kitchen table or island.

Step 2: Every Sunday during dinner, write 1 little note about something cool that happened that week. Encourage your kids to do it too. Put all the notes in the jar.

Step 3: Let the notes build up over time, then any time you need a positivity boost, pull one out at random and read it! (or, let your guests and visitors read some to brighten up their day, too!)

The secret to happiness = regular expression of gratitude. Build it into your routine so it’s automatic. 😉

TAXES

Yay, it’s tax time again… 😓

I know, it’s not everyone’s fave time of year. But life isn’t fair and your taxes need to get done somehow, right!?

Hey, look on the bright side — behind all the numbers and paperwork lies some good insights and more clarity into your finances.

Anyway, here are a few things to consider for this filing season…

Standard deduction: For 2023, the standard deduction is $13,850 for single filers ($27,700 for joint filers). It’s important to know that ~90% of people take the standard deduction (vs itemizing every little thing). Unless you have major deductions (like significant charitable contributions) that raise you above that threshold, opting for the standard deduction makes the most sense and ensures you’ll have a simpler tax return.

1099-K: Last year the IRS said they were cracking down on any payment app income over $600 (Venmo, PayPal, etc). But this $600 threshold and plan is delayed for tax year 2023. Instead, the IRS is planning a new threshold of $5,000 for tax year 2024.

IRS Direct File: This is a brand-new pilot program designed for the simplest tax returns. Right now it’s only available in 12 states and has some income limitations. Check here for all eligibility criteria and to be notified when it’s widely available. Early reviews of the IRS’ proprietary filing system aren’t stellar so you might want to consider one of the tools below.

More DIY tools... For basic returns with very little complexity, filing your own taxes with online the software is the best way to pay little (or nothing) to file. If you make less than $73k AGI then IRS FreeFile is open to you and is one of the best resources. If you make more than that, Cash App Taxes is probably the absolute best free filing option in existence. FreeTaxUSA is another great site for free Fed filing and $15 for state.

Don’t file too early (or wait too late): I know you’re eager to get this crappy task off your plate, but it’s still early February and you might not have all your docs/forms yet! It’s better to wait and file a complete return than have to adjust it later or make mistakes. Who wants to perform this task twice!? Still, don’t procrastinate too long or you’ll be up against the deadline.

Hiring a tax pro: If your taxes are looking complex (like you own multiple rental props, have a handful of various income sources, or had big life changes in 2023 that might unlock larger deductions) then it might make sense to hire a tax pro. If you don't have one yet, now is the time to start making phone calls. These tax geniuses are going to be too busy to take your call in April!

Stay Organized: The best tax advice I ever received was whenever a document arrives in the mail, open it and scan it immediately into your filing system. W2s, 1099s, 1095s, and the million other forms you get… Keeping them organized makes it 100x easier when you finally sit down to file.

Lastly, think long term!!!: The greater goal should be to minimize your tax burden over the long haul, not just in a single year. (Listen to Ep#758 with tax pro Sean Mullaney if you haven’t already!)

Best of luck, y'all. 💪💪💪

Related stuff:

• 👩‍💻 New HTM Post: Should Your Hire a Tax Pro This Year?

• 👮‍♀️ Tax FAQs: IRS Interactive Tax Assistant (new search feature and a bunch of helpful FAQs from the IRS site)

• 📝 File Organization Tips: Becoming a tax ninja organizer

TOGETHER WITH BILT*

About 78% of renters still pay their landlords with a handwritten check each month.

And while there’s nothing wrong with that, they could step into the modern era and earn rewards via BILT for their rent payments! BILT is a credit card and rewards program that mails checks to landlords (or pays them via an app) and gives renters a credit card with points potential.

One important note — you need to make at least 5 transactions each month on the credit card to earn rewards. But this card also offers 2x points on travel and 3x points for dining transactions.

Check out the first credit card that allows you to earn rewards for paying rent. Learn more about BILT here. Oh, and there’s a $0 annual fee 😉

RETIREMENT

Employer Match = YEARS of Freedom… 😳

Here’s a cool chart recently posted by Cody Garrett on LinkedIn.

It converts 401k match percentages into time paid in retirement👇👇👇

Let’s say your employer offers a 4% match for 401k contributions… That equates to 2 full weeks of pay each year.

And if you take advantage of that 4% match for 25 years, that match you’ve been snagging will grow to cover nearly 3 years of pay in retirement!

Of course, if you’re a regular HTM-er you already know how awesome 401k matches are and you’re taking full advantage. Sadly, stats find that about 25% of Americans out there who have employer matching opportunities miss out on this “free money” because they don’t contribute enough to qualify! (If this is you, make a change ASAP — it’s the lowest-hanging fruit for boosting your retirement nest egg!)

If you already contribute and get the full match, that’s great! But pass on the knowledge by checking in with your friends/family and showing them this chart. Make sure they’re taking full advantage too. This matters for folks with small salaries as well… Every little bit counts!! 💪

Related Stuff:

• ⚙️ Money Gears: If you’re just starting out saving, check out the 7 money gears. Follow them in order if you can!

• 👨‍💻 HTM Blog: How to build wealth on a small income 

ICYMI

In other news…

Stress Less 🧘‍♂️
A new study finds that “people who have money issues are more likely to suffer serious health consequences”. If you’re stressed about your finances, it’s time to make some changes — your physical health depends on it!

Geoarbitrage 🗺️
Would you move to a small new city in the US if they paid you $10,000? MakeMyMove is a site that shows you all the small towns offering incentives for remote workers to move there.

Early Payday 🙈
Beware of “earned wage access”— It’s just a fancy term for getting your paycheck before payday (it’s much like payday lending but they bypass regulations by having a sneaky fee structure).

Secrets 🤫
Bankrate’s latest Financial Infidelity Survey finds ~42% of adults married or living with a partner have kept financial secrets from each other. The biggest offenders are Gen Z and keeping secret savings accounts or opening a secret credit card are the biggest culprits. 😬

Dead time 🚘
All you math nerds will like this post… Why Driving Faster Takes Longer, by Algorithm Soup.

HOW *YOU* MONEY

Robert, 33, Manassas, VA 🏡

Occupation: IT Manager
Salary: $165,000/y

Paycheck deductions: Taxes $1380, Health Ins $75, Roth 401k $959, HSA $200, Life Insurance + Disability $25
Rent: $2,080 + $300 utilities
Other Debts: None
Living expenses: ~$2,500

Leftover savings each month: $5k-ish.

How are you investing your excess savings each month?
High-yield savings account for our housing fund and wife's IRA.

Biggest “craft beer equivalent” splurge:
Video Games/Sports Cards

Best savings hack/advice:
This is hard, I just have never wanted debt since I had student loans. We don't budget, I max out my Roth 401k and HSA and just kind of let the chips fall where they may after that. Having a separate online savings account with a different company from my direct deposit checking account has helped me not touch that savings.

Biggest money challenge right now?
My job has had us moving a lot over the past 3 years. I'm at my 3rd different site location and potentially 4th soon. This has made buying a new home since we sold our previous home difficult and frustrating. We're sitting on 175k in our high-yield savings for our next downpayment. It has frustrated my wife and she has splurged more lately because of that. We still don't touch our down payment funds but it has resulted in less savings in the last few months because of the frustration.

Recent money win and how did you celebrate?
Maxed out my 401k two months early in 2023 because my income has increased. I bought myself and a friend a card that we both wanted because we bond over this shared hobby.

Anything else you want to share?
I'm far from perfect with my money. Out of sight out of mind has always been the best practice for me. I feel as long as I max out my 401k and HSA and don't touch my savings then I can be flexible month to month with my paycheck and how I spend it.

**How do YOU 🫵 handle your income/savings/investments? We’d love to hear about it & share your story — Fill out this HYM form! (Don’t worry, we won't publish anything without you approving it first)**

Welp, that’s it for now. See you next week! Until then, stay awesome 🫵 😎 

Best friends out! 🍻