It’s been a tough year financially for many people, but don’t despair for 2023 just yet.
In fact, a good check of your portfolio may show you that you could be better off financially than you think you are. You may have more money saved than you realize, or the future may be better than you’re expecting.
So before you worry about all the negatives in your financial outlook, check out some of the surprising reasons why you might be doing better than you think.
Stocks are lower than a year ago
You may have lamented the red ink on your 401(k) reports as stock markets went down, but that also means you can pick up some solid stocks at bargain prices in 2023. So if you have some cash that’s been sitting on the sideline, now may be a good time to consider getting back into the market with lower prices.
Pro tip: Use the start of the year to check on employment contributions into your retirement accounts and try to match them to the maximum amount they offer to get the most of that benefit.
Rising interest rates boost your savings
Sure, you may be worried about rising interest rates if you’re applying for a loan for a home purchase or car purchase. Those rising rates, however, can be a good thing for your savings.
The rising interest rates may allow you to earn more money on the cash you have sitting in your bank or financial institution. It also may be a good idea to check on moving some of your cash to a high-yield savings account if you want to maximize any additional earned interest.
The housing market is cooling off
You may have been saving for a new home and wondering when you’ll ever be able to use it for a downpayment. After all, prices have been rising and you may have been priced out of the market in recent years.
But you may have an opening to buy that home you want as the market has begun to cool off and prices are finally decreasing in the U.S. So give that down payment another look and think about what that can buy you in the area you’re currently searching for a home.
Your side hustle paid off
Side hustles are a great way to make extra money and have become a viable option for some people to boost their bank accounts. Maybe you discovered your love for a hobby during the pandemic and you’ve been able to monetize it, or you’ve decided to use your free time to pursue another way to make money outside of your 9-to-5 job.
Even a few extra dollars can help if you’ve been able to turn a profit with your side hustle, so focus on your side-hustle successes and what you can do to make your side hustle continue to work for you.
The labor market is strong
The unemployment rate continues to go down while the number of people finding jobs is increasing. And the average hourly wage in the U.S. continues to go up for employees.
Those statistics could be good news for you if you’re looking for a new job. You may be able to find something else with better pay or benefits as wages increase and you won’t have to worry about excessive competition with a low unemployment rate.
Cancellation of some student debt
The government confirmed two student loan cancellations in 2022 that may give a boost to your financial portfolio. It canceled almost $6 billion for students who were defrauded by educational institutions and another $24 billion in loan forgiveness was approved as part of the Public Service Loan Forgiveness program. So check and see if you qualified for one of these loan forgiveness programs to help you clear off some debt.
You changed jobs
There may have been a bit of an upheaval in your work life; maybe you changed jobs or perhaps even careers. But you wouldn’t be alone. In fact, the dramatic job switch for many workers was given the name the Great Resignation.
One of the biggest reasons employees gave for making a change was increasing pay. So while you may have been nervous about making a change, that switch to a new job could be paying off for you in your bank account.
Tackling your debt
As your career outlook may have switched in the past few years, it may have helped you find or save some extra cash to put towards paying off debts. Consider the loan payments you may have paid in the past year that have gotten you closer to getting rid of that loan. And consider credit card debt that you may have been able to knock down recently as well.
Pro tip: There are clever ways to pay off debt if you’re ready to take on your expenses and cut down on the cash you may owe for loans or credit cards.
Working from home helps you save
You may have been able to save some extra cash if you’ve been working from home in recent years. And while you may miss the office some days, it’s also a good idea to check your bank account and see how the change in your work environment has helped you financially.
Sit down with your budget to see how much you may have been able to save by not spending money on gas or wear and tear on your car because of a commute. You also might want to factor in the cost of things like lunch or coffee that you’ve been able to save.
Sometimes it may be frustrating to look at your financial portfolio and wonder if you’re better off financially than you were a few months or a few years ago. But there are surprising ways that you may have been able to save cash and keep your financial portfolio in check. It’s also a good idea to spend the next year focusing on those positives as you continue to create a more stable financial future for yourself.