Cortburg Speaks Retirement

How Does a Leap Year Impact Your Finances?

• Miguel Gonzalez, MBA, AIF®, CPFA®, CRC® • Season 2024 • Episode 176

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On this week’s episode, Miguel talks leap years and the little-known ways it can impact your finances!

About Cortburg Retirement Advisors, Inc. 

Cortburg Retirement Advisors is a full-service, boutique financial planning firm - helping guide clients through turbulent and calm economies. Their goal is to help grow, protect, and preserve their assets from their first job through retirement. Cortburg’s “all in one house” capabilities mean that their experienced team can help with all financial needs - wealth management, estate and tax planning, group retirement, employee benefits, insurance, and retirement planning.    


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Welcome to Cortburg Speaks Retirement Podcast
with Miguel Gonzalez, MBA, AIF®, CPFA®, CRC®

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INTRODUCTION

Welcome to Cortburg Speaks Retirement

An audio podcast about investing in the stock market, financial planning, money management and retirement planning.  Each Wednesday, we help investors at all stages of life learn how to potentially grow and preserve their money from first job through retirement.

Now here is your host, Miguel Gonzalez. 

HOST

Good morning and welcome to the CORTBURG SPEAKS RETIREMENT audio podcast.   

On this week’s audio podcast, we’ll talk about leap years and the little-known ways it can impact your finances!

Life is full of strange and interesting things, like Halley’s Comet and the Northern Lights, and one that affects us all, even if you don’t realize it, is a “leap year.” Every four years, an extra (or intercalary) day is added to February to keep the calendar aligned with the seasons. On a leap year, the shortest month of February gets an extra day based on the Gregorian calendar, the internationally accepted civil calendar that replaced the Julian Calendar in the United States around 1752 for the purpose of calculating leap years.

Why is leap year significant?

The calendar year we follow is not completely aligned with the 365-day cycle of the Earth revolving around the sun. It takes the Earth 365 days and six hours to travel around the sun, and because of that extra time, a leap year is needed to stay balanced.

What would happen without leap year?

If we didn’t consider this lapse in time over, let us say, the next 750 years, instead of summer beginning in June, it would occur around mid-December or so.

How does leap year impact our finances?

Financially, a leap year will affect everybody, whether you realize it or not. Leap year could directly affect you depending on how you live, for example, your employment structure. On a typical day, you heat and air-condition your home, shop for food, and use gas to get to the grocery store unless you use public transportation. Even your typical day-to-day activities can determine how leap year affects you. Here are some pros and cons to consider:

 

Leap year pros:

·         Individuals who use public transportation or parking essentially get a free day of usage, as the extra day isn’t accounted for in the monthly billing calculation. Take the money you saved that day and maybe pay down a bit of debt.

·         Those with a fitness membership, similar to public transportation, get a free day of exercise, as the added day isn’t accounted for in the monthly billing calculation. Take those few dollars you saved that day and contribute it to your retirement or investment portfolio.

·         People who rent have a free day of room and board. Landlords generally don’t charge for an extra day during a leap year because the additional day is accounted for as part of the month of February.

·         Some employers give an extra holiday day during leap years. An extra paid day off from work can be used to review your budget and financial plan, work a side hustle to help pay for debt, or save for your children’s college tuition. Think outside the box and use your extra time and money to align your strategy with your financial goals.

 

Those are some great pros to managing leap year. However, along with the positives, you also have to take into consideration the negatives, for example:

Leap year cons:

·         There is an extra day of fuel being consumed.

·         You have one extra day of purchasing food at the grocery store or spending money at a restaurant. It is no secret that food costs can become significant over time.

·         There are 24 hours of utility costs added to your bill. This could be noticeable for much of the country in a cold month like February.

·         You pay an extra day of interest in a leap year.

 

For people who live on a tight budget, an extra day may not necessarily be something they look forward to. However, with adequate planning and a manageable budget, you may be able to mitigate some of the stress of another calendar day of expenses.

Consider consulting a financial professional

Consider consulting a financial professional who can work with you on a budget, an investment, or a saving strategy. They can offer tips for managing extra money that comes in, for example, from working an extra day because of leap year.

Make sure to visit our website, www.CortburgRetirement.com. Our site is filled with educational videos, eBooks, publications, and financial calculators designed to help you learn more about your finances.  As you search our site, send us a note regarding any questions you may have about any particular investment concepts or products. We will get back to you quickly with a thoughtful answer.

This is Miguel Gonzalez, Certified Retirement Counselor (CRC) and Managing Partner, with Cortburg Retirement Advisors signing off for this week’s educational podcast.  

 DISCLOSURES  

Opinions expressed are subject to change without notice and are not intended as investment advice or a solicitation for the purchase or sale of any security. Please consult your financial professional before making any investment decision. 

All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.

CRC conferred by The International Foundation for Retirement Education.

Securities offered through LPL Financial. Member FINRA/SIPC. Investment advice offered through Private Advisor Group, LLC, a registered investment advisor.  

Private Advisor Group, LLC and Cortburg Retirement Advisors, Inc. are separate entities from LPL Financial.

Investing involves risk including possible loss of principal.

·         The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. 

·         All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

·         This article was prepared by LPL Marketing Solutions.

·         Sources:

o   The Economic Impact of Leap Year | Savant Wealth Management

o   Leap Year's Added Day Isn't Viewed as a Bonus by Everyone - Los Angeles Times (latimes.com)

 

 

 

Contributor

Miguel Gonzalez, MBA, AIF®, CPFA®, PPC®, CRC®

Host