5 Ways to Get Financially Fit for 2014


NEW YORK (MainStreet — The holiday season is in full swing, and the year is quickly coming to an end. With all the holiday shopping, year-end audits, and vacation planning going on, it's easy to get overwhelmed. If you're looking for a reprieve from the winter grind, hide out in your room, and try one of these productive ways to keep your mind occupied. First and foremost, though, remember to stay relaxed throughout the process:

1. Review Your Taxes

With every new year comes a new round of taxes. There's no worse feeling than going through your finances in the spring only to realize there's something you missed. Once the calendar at the IRS changes over, there's nothing you can do about that missed 401(k) payment, health spending account overage, etc. Taking 30 minutes out of your day today can save you hours of headaches in a few months. With Obamacare this year, you can deduct health care costs if they exceed 10% of your adjusted gross income (AGI), so if you're teetering on the edge, it might also be time to schedule some last minute X-rays, sonograms and check-ups.

2. Start or Buy a Business

It may seem like an odd thing to do so close to the holidays, but the end of the year is a great time to start a business. Businesses are a great investment, so long as you know what you're doing. They can help you lower your tax rate, earn additional income and improve the community around you. There are several ways to start a business, and not all of them involve a lot of time or money to work.

Simply by registering an LLC (~$400 will register the name & cover the cost of publishing the business name per your specific state statutes), you will have created a possible tax shelter that can assist you with next year's filing. If you're looking for a pre-made business, there are a variety of listing sites where you can find a business for sale in the U.S. You can also buy a franchise. Even if all you do is sell some homemade crafts or fudge for extra Christmas money, it's still a financial boost, and 'tis the season for commerce.

3. Pay Back Personal Debts

Studies have shown that having a lot of debt is hazardous to your health. If you owe anybody money, the holiday season is a great time to pay the person back. Friends and family will often appreciate the repayment of a debt more than receiving a gift. Getting that weight off your shoulders may hurt in the short term, but in the long run, you'll feel much better about yourself.

Depending on the circumstances, there's a good chance the person you pay back will even use the money to buy you a much better gift than normal. I know this sounds selfish, but I'm trying to convince you to pay your friends back on Christmas on a financial website, so I have to cover both the Whos and Grinches of the world.

4. Start a Hobby

People are constantly asking you what you want for Christmas or your birthday. Rather than being shy, tell them about the hobby you always wanted to start. Maybe you want to learn the guitar but never wanted to buy one. Perhaps you've always been interested in pottery, but don't know how to get started. These aren't things you need to worry about if you have friends and family.

If you want to play the guitar, you may end up with a new foldable Fender acoustic electric, or you may get a Groupon for guitar lessons. No matter what happens, you're more likely to stick to a resolution you made before Christmas than a promise on New Year's Eve.

5. Freeze Your Credit Cards

I don't mean to call the company and put a freeze on your card; I mean literally to put all of your credit and debit cards aside from just one you need to pay your bills. Put the cards in a large bowl or bucket, fill it with water, and put it in the freezer. The more ice you bury the cards in, the longer it'll take to thaw. This is a proven method to stop impulse spending. By putting your cards on ice, you're ensuring you make it through the holiday season and start next year with money left in your pocket.

Brian Penny is a former analyst at Bank of America turned whistleblower, Anon supporter, and consultant.

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