As you approach retirement, understanding your Social Security benefits becomes crucial for financial planning. Your benefit amount hinges on factors like earnings history and age at sign-up. With careful planning and strategic decision-making, you can maximize your Social Security benefits to ensure financial stability in your golden years. Here are proven strategies to help you make the most out of your Social Security benefits.
Delay Your Claim
One of the most effective ways to increase your Social Security payments is by delaying your claim beyond your full retirement age (FRA). For each year you delay claiming benefits, your payments could increase by up to 8%, until you reach the age of 70. After age 70, there is no additional benefit for waiting to claim benefits.
Stay in the Workforce Until FRA
You can begin collecting Social Security payments at age 62. However, opting for this early withdrawal results in reduced monthly payments, while waiting until FRA provides higher monthly payments.
FRA is age 66 for those born between 1943 and 1954, gradually increasing in two-month increments thereafter. Individuals born in 1960 or later reach FRA at age 67. Claiming benefits before you reach FRA results in a permanent deduction.
Maximize Earnings
Be strategic about when you earn your highest income. Since Social Security benefits are based on your highest 35 years of earnings, consider working overtime, asking for a raise, taking on side jobs, or seeking higher-paying jobs in the years leading up to retirement.
There is a maximum earnings threshold – adjusted each year for inflation – which is used to calculate Social Security benefits. In 2024, earnings up to $168,600 are used to calculate retirement benefits. However, any income beyond this threshold isn’t subject to Social Security tax and won’t influence future benefit payments in retirement.
Claim Spousal Benefits
Married individuals have the option to claim spousal benefits based on their spouse’s work record, which can be up to 50% of their spouse’s benefit amount. This can be particularly advantageous if one spouse has significantly higher earnings. The lower-earning or nonworking spouse needs to sign up for spousal payments at his or her FRA to get the 50% spousal payment. The percentage is reduced if this spouse starts benefits before their FRA.
Coordinate Spousal Benefits
Spouses can strategize to maximize their combined Social Security benefits by coordinating when each spouse claims their benefits. This may involve one spouse delaying their claim while the other claims benefits, allowing the delayed benefits to grow.
Know Retirement Earning Limits
If you claim Social Security before reaching FRA and continue to work, a portion of your benefit might be temporarily withheld.
In 2024, Social Security recipients under FRA earning over $22,320 will see $1 withheld for every $2 earned beyond this threshold. At full retirement age, the earnings limit rises to $59,520, with a penalty reduction to $1 withheld for every $3 earned above this limit.
Upon reaching full retirement age, you can work while receiving Social Security without penalty. Your benefit will be recalculated, accounting for any previously withheld payments and your ongoing earnings.
Minimize Social Security Taxes
Be aware of the tax implications of your Social Security benefits. Depending on your adjusted gross income, a portion of your benefits may be subject to federal income tax. Careful strategizing, like minimizing other sources of taxable income, can help reduce the taxation of your Social Security benefits.
Maximize Survivor’s Benefits
Surviving spouses are entitled to receive the higher of their own benefit or their deceased spouse’s benefit. If your spouse received the higher benefit, you might qualify to claim your spouse’s survivor benefit initially, letting your own benefit accrue, and then transitioning to your benefit later in life. By understanding the rules surrounding widow/widower benefits, you can ensure you receive the maximum amount possible.
Navigating the financial landscape is paramount for small businesses to thrive, but there are ample opportunities for errors that can hinder success. In this article, we’ll go over key strategies that small businesses can implement to sidestep common mistakes and achieve financial stability.
Prudent Budgeting
Effective budgeting is the foundation of sound financial management for small businesses. By creating a comprehensive budget that accounts for both fixed and variable expenses, you can gain better control over your finances and allocate resources strategically. Regularly review and adjust your budget to reflect changing circumstances and priorities, track expenses, and review financial reports to ensure that your business remains on track financially.
Build an Emergency Fund
Unforeseen expenses and economic downturns can pose significant challenges for small businesses. Building an emergency fund provides a financial safety net, which will help to weather unexpected storms without jeopardizing business operations. Aim to set aside a portion of business revenue each month into a dedicated savings account, gradually accumulating a reserve that can be tapped into during times of need.
Monitor Cash Flow Closely
Keep a close eye on your cash flow by consistently monitoring incoming and outgoing funds. This helps to identify financial red flags early on, such as cash flow issues, decreasing profitability, or unforeseen expenses, so you can combat these issues before they get out of control. To optimize cash flow, implement strategies to accelerate receivables and delay payables where possible. Additionally, consider leveraging digital tools to streamline invoicing, payment processing, and financial reporting.
Diversify Revenue Streams
Relying heavily on a single revenue source can leave your business vulnerable to market fluctuations and industry disruptions. Diversifying your revenue streams can help mitigate this risk and create a more resilient business model. Explore opportunities to expand your product or service offerings, target new customer segments, or expand to adjacent markets to diversify your income sources.
Negotiate Favorable Term
Effective negotiation can result in significant cost savings and improve your bottom line. Whether it’s negotiating with suppliers, contractors, or landlords, don’t hesitate to advocate for your business’s interests. By securing favorable terms and agreements, you can reduce expenses and enhance profitability.
Invest in Technology
From accounting software to customer relationship management (CRM) systems, investing in technology tools can help automate repetitive tasks, improve decision-making, and empower your team to work more effectively. Invest in technologies that will address your business’s specific needs and produce tangible benefits.
Seek Professional Guidance
Don’t hesitate to seek guidance from experts like accountants, financial advisors, and business consultants. These professionals can offer valuable insights, expertise, and strategic advice tailored to your specific business needs. Whether you’re seeking guidance to optimize tax strategies, create a growth plan, or navigate complex financial regulations, their assistance can be instrumental in helping to avoid pitfalls and ultimately achieve financial success.
Employee retention is an essential component of success for any veterinary practice. High turnover rates can disrupt workflow, impact client satisfaction, and hinder business growth. In this article, we’ll explore effective strategies to help you retain talented professionals whose contributions help maintain a thriving practice.
A Comprehensive Strategy
When your veterinary practice faces retention issues across the board or deals with high turnover in numerous roles, you need to zero in on the factors influencing both retention and staff turnover that have the greatest impact on the entire team. This includes the following:
Compensation
High turnover suggests that employees perceive their basic needs are not being fulfilled. A central need, of course, is compensation. Ensure that your salary and benefits packages are in line with industry standards and reflect the value of your employees’ contributions. Additionally, consider implementing performance-based incentives and bonuses to reward top performers and incentivize excellence.
Teamwork
Once this basic need is met, practices can prioritize factors that prevent turnover and foster retention. Teamwork takes center stage here, as a cohesive team dynamic is essential for all staff members. Offering scheduling flexibility and diverse job duties, along with promoting employee well-being, further solidifies staff satisfaction.
Career Growth Opportunities
Addressing these factors should already lead to a notable improvement in retention rates, but further steps can be taken to boost loyalty and improve employee satisfaction such as professional development and career growth opportunities. Provide ongoing training and support for skill development, offer mentorship programs, and encourage employees to pursue continuing education and certifications. Invest in their professional growth, and they will be more likely to stay and grow with your practice.
Staff Check-Ins
Finally, be sure to schedule regular check-ins with your team members to discuss their goals, provide constructive feedback, and address any concerns they may have. Create a supportive environment where employees feel comfortable sharing their feedback and ideas for improvement.
A Role-Based Strategy
For practices experiencing high turnover in specific roles, a role-based approach allows for targeted retention strategies tailored to the needs of those roles. Identify the reasons behind the turnover in these roles, whether it’s workload, lack of support, or insufficient training.
Provide adequate training and support for employees in these roles to ensure they feel confident and capable in their positions. Offer mentorship opportunities and assign experienced team members to provide guidance and support to newer employees.
Address workload issues by redistributing tasks or hiring additional staff to alleviate pressure on employees in high turnover roles. Implement efficient workflows and protocols to streamline processes and reduce stress on the team.
Offer incentives and rewards specific to the roles experiencing high turnover. This could include performance-based bonuses, recognition programs, or opportunities for advancement within the practice.
Reducing turnover and inspiring retention in your veterinary practice requires a comprehensive approach that addresses the needs of the entire team as well as specific roles experiencing high turnover. By fostering a positive work environment with a staff that functions as a team, offering competitive compensation and benefits, providing opportunities for professional development, and implementing targeted retention strategies, practices can create a workplace where employees feel valued, engaged, and motivated to stay for the long term.
Understanding how economic trends influence construction can provide valuable insights for businesses and professionals in the field. For instance, high interest rates and slower economic growth will put increasing pressure on construction and manufacturing this year. Here’s a comprehensive look at how the current economic landscape is likely to impact construction in 2024.
Inflation and Interest Rates
The economy is still experiencing inflation pressures from energy prices, wages, and consumer spending, which impacts project financing.
Additionally, with interest rates playing a pivotal role in construction financing, the Federal Reserve’s actions this year regarding cutting interest rates hold significant sway. Lower interest rates will stimulate borrowing for construction projects, reducing overall borrowing costs for businesses and clients. This creates incentives for investment in construction ventures, particularly in the residential sector.
Supply Chain
Late last year, construction companies were still facing supply chain issues, but construction firms can expect supply chain improvements as the year progresses, which will help reduce delays in construction projects. The pandemic changed communication methods between the construction industry and suppliers, with construction firms adopting communication technologies to streamline material ordering workflows. With access to more complete and speedy information, construction firms are empowered to keep projects on track.
Labor Market
The construction job sector experienced growth last year. However, construction job openings have decreased recently, even though wages have increased by 4.9%. This highlights the importance of competitive pay and innovative training programs to attract and retain employees.
Recession Worries
Higher employment and higher wages create more spending power and add to the supply and demand issues perpetuating a potential recession. With interest rates stalling and contributing to a decrease in project financing power, an economic recession is still top of mind for businesses. While signs at the moment are pointing to a soft landing, the construction industry should still be preparing for economic shifts.
Shifting Geopolitical Landscape
The Israel-Hamas conflict heightens concerns about the possibility of broader tensions in the Middle East, which could potentially impact energy and other raw material prices. U.S. sanctions on Iran might exacerbate these issues, while ongoing tensions between the U.S. and China could contribute to inflationary pressures.
Small businesses are not immune to the effects of broader economic shifts. As highlighted by the pandemic, major global and domestic events have the potential to profoundly influence businesses across the board, regardless of size. In 2024, larger economic conditions and fluctuations could have a significant impact on small businesses. Read on as we delve into four hurdles that have the potential to affect small businesses this year.
Economic Uncertainty
The previous year presented challenging economic hurdles for businesses of all sizes. Surging inflation significantly affected businesses, leading to spikes in overhead expenses and interest rates. Although recent data from the Office for National Statistics (ONS) indicates a gradual decline in monthly inflation rates, they still surpass the government’s targeted 2%. Small businesses will likely feel a greater impact compared to more established businesses, given their absence of cost-saving benefits from economies of scale, which typically provide some breathing room during challenging economic climates.
Political Tensions
Election years can introduce some unpredictability and prompt a certain level of economic insecurity. Businesses and investors may hesitate to make significant decisions until they have clarity on the direction of future policies, which can lead to a slowdown in economic activity. Additionally, campaigns and debates that focus on economic issues can contribute to market volatility.
International Instability
Ongoing geopolitical pressures, such as the conflict in Ukraine and the hostilities between Israel and Hamas, can affect international trade and the overall U.S. economy. These tensions, as well as others around the globe, have the potential to spark trade conflicts and disrupt the international movement of goods and services, potentially resulting in shortages of raw materials and production delays. This, in turn, can escalate import and export expenses, contributing to overall price hikes.
Is a Recession Happening?
This has been the question posed by businesses and consumers since late 2022. A lingering uncertain economic forecast could make companies hesitant to invest in bigger expenses, such as new research, equipment, or real estate. While the Federal Reserve’s incremental interest rate hikes have helped to suppress inflation, whether or not we’ll come out of this economic rollercoaster with a “soft landing” is still a question mark. Small businesses should still be preparing for the possibility of a recession this year.
After two years of rapid interest rate hikes, which sent mortgage and credit card rates soaring, investors and consumers are wondering when the Federal Reserve is planning to lower interest rates. In short, the Fed is looking for more positive signs from the economy, but rate cuts will likely happen in 2024. Read on to learn how soon this might happen.
Inflation and the Fed
In March 2022, the Federal Reserve initiated a series of rate hikes as a strategic measure to combat soaring inflation rates, a traditionally effective method used to curb consumer spending and mitigate price surges. Since then, the central bank has executed 11 rate hikes, which have significantly reduced the annual inflation rate to 3.1% in January, down from its peak of 9.1% in June 2022. However, January’s figure was higher than economists’ projections – and persists above the Fed’s target of lowering inflation to 2%. Given January’s hot inflation data, deep rate cuts aren’t likely to happen soon.
When to Expect the First Cut
Because January’s number was higher than previously forecasted, economists are now projecting the Fed’s first cut will happen farther along in 2024 than they had earlier estimated. This means the Fed’s next meeting in March is unlikely to result in cuts, and some are saying the May meeting may even be too soon. Instead, most economists aren’t expecting the first rate cut until the Fed’s June 12 meeting.
What Does This Mean for Americans?
Borrowers likely won’t see changes to loan terms anytime soon. Credit card rates, auto loans, and other credit products that are based on the Fed’s benchmark rate will likely stay steady at or near their current levels until the first rate cut.
Mortgages are slightly different. When inflation growth is worse than expected, mortgage rates tend to increase. Therefore, we might see a rise in mortgage rates in the upcoming weeks, but ultimately stabilizing around 6% by year’s end.
What to Do with Your Money in the Meantime
Here are some steps you can take with your money while you wait for rates to drop.
Open a Certificate of Deposit
When the Federal Reserve reduces rates, annual percentage yields (APY) on savings accounts also decrease. However, interest rates on certificates of deposit (CDs) remain unchanged once the account is opened, ensuring a fixed rate regardless of any fluctuations in APYs.
Strengthen Your Credit Score
If you’ve been holding out for lower rates before applying for a mortgage or personal loan, it’s time to prepare. Lenders heavily weigh your credit score in the approval process to determine the interest rate you’ll receive. While a credit score of 620 is the starting point for a conventional mortgage, aiming for a score of at least 750 can help you qualify for the most favorable rates.
To be sure your credit score is primed for the best rates, make on-time payments of credit cards and loans in full; request higher credit limits in order to lower your credit utilization ratio; and hold off on applying for new lines of credit as the application could require a hard inquiry that hits your credit.
