10 Money Resolutions for San Diegans to Consider for Financial Health in the New Year

  • Share:
January 19, 2021
By Steven DeMatteo, Financial Advisor at UBS Wealth Management USA 

2020 was a year like no other. $12.4 billion in gross regional product is expected to have been lost in San Diego in 2020 and $4.8 billion in wages lost in the first six months of the pandemic, according to SANDAG. Businesses had to pivot, with many going virtual as a result. More restaurants offered take-out; unfortunately, some, such as San Marcos Brewery & Grill, Casa Sol y Mar in Carmel Valley, and Phil’s BBQ in San Marcos, were forced to close.
 
And while the pandemic has severely impacted the hospitality industry here, some other sectors, such as biotech, residential real estate, and digital transformation, are doing well, and there are some bright spots overall. Unemployment has fallen to 6.6% in November 2020, from 7.5% the month before, according to the California Employment Development Department; the average San Diegan working in life science makes $130,000 a year, well above the county’s 2014-18 median household income of $75,000; and residential sellers may benefit from home prices and sales rising across Southern California.
 
Specific financial questions North County-area clients are asking this year are also a little different—Will the new administration raise income or capital gains rates? Is 2021 a good year to sell my business?  If so, how do I replace my income with bond yields so low? And is the equity market expensive or in a bubble?
 
Many are hopeful that, with the rollout of the vaccines, 2021will bring an end to the pandemic and more opportunities.
 
Regardless of where you stand financially, a new year brings promise, and is a great time to reassess your financial plan. Following are 10 financial strategies to consider.
 

  1. Assess your spending habits– which have, likely, changed in the pandemic. Understand your current revenue or income after taxes, as well as expenses. Look for trends on where you’re most likely to spend and there are opportunities to save. Examine opportunities to address credit or debit card statements head-on and create a realistic plan.

  2. Budget– with the 50-30-20 rule: 50% goes toward “must-haves” (groceries, rent, car insurance, other expenses you can’t or shouldn’t live without); 30% goes to discretionary (entertainment or shopping); the last 20% goes to savings and investments. This guideline can be adjusted based on your spending habits and discretionary income to reflect a strategy to which you’re most likely to adhere.

  3. Lower debt– Alleviate the nagging worry of debt, and mounting interest, by making minimum required monthly payments, or more, if possible. Know the balance and interest rate for each loan you have and seek out ways to refinance to shorten repayment schedules.

  4. Invest in retirement– while it might seem like a lifetime away for some, saving for retirement can never start too early; the earlier you start, the longer these funds have to grow. If your employer sponsors a retirement plan, take advantage if you can.

  5. Max out your HSA– often underused, Health Savings Accounts can offer tax advantages for individuals with high deductible health plans to save for healthcare expenses. These funds can be rolled over from year to year, building up as you age, and are available when you may need to use them more. There is no time limit on usage of the funds. 

  6. Stay informed– become more familiar with the markets and how/why they move to better understand your portfolio and investing strategy. Start small by reading the local business section and other resources.

  7. Invest in long-term trends– like automation, smart mobility, renewable energy, especially for younger investors with long investment time horizons. Consider thematic investing, linking long-term trends and related social and environmental challenges to investment ideas or tie investments to your personal values.

  8. Give back– with a donation of time or money to organizations you are passionate about.

  9. Talk about money– with your spouse or partner. Break the trend of not talking about money and instead share stories to validate your experiences and support your goals together. 

  10. Enjoy– if you are able; use a portion of your funds to appreciate its perks without regrets, and, even better, do so supporting local shops and restaurants. 

 
When you take steps focused on planning for spending, saving, and investing, you can become more empowered. 
 
Here’s to a prosperous 2021 for San Diegans and our region!
 
 

Steven DeMatteo is a Financial Advisor with Torrey Pines Wealth Management, a UBS signature team. Together with his team, Steven draws on broad experience in the wealth management industry to help clients exit their companies, develop retirement plans, and preserve wealth for future generations. He has earned the Wealth Advisor and Certified Exit Planning Advisor (CEPA) designations, is a member of the esteemed UBS President's Council and was a 2018 recipient of the UBS Aspire Award for collaboration, leadership and service.  Steve is also a retired Marine Corps helicopter pilot where he was decorated for performance in peacetime, humanitarian and combat operations. 



 
Contact:
Steven DeMatteo, Senior Vice President
steven.dematteo@ubs.com, (858) 947-7094