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    5 ways to counter the payroll tax increase

    6:16 AM, Jan 16, 2013   |    comments
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    LITTLE ROCK, Ark. (KTHV) -- You didn't imagine it, your paycheck really did shrink. Thanks to an increase in payroll tax, more of your money is going to fund Social Security.

    Making up for that loss in income will require some careful planning, so this morning we're giving you five ways to find money to counter the increase from Shine by Yahoo!

    1. Adjust your tax withholding - People could get extra money a month rather than get a big income tax refund every year from the IRS. This is money you can use for every day expenses. You can figure out the withholding allowances you should claim by using the worksheet on the IRS website.

    2. Max out your 401(K) - Contribute the maximum amount to your 401(K). You'll reduce your taxable wages by the amount you put in. According to Shine by Yahoo! "This year, you can save up to $17,500 in a 401(K), a three percent increase from 2012." Those over 50 can add an extra contribution of $5,500 for a total of $23,000 in 2013.

    3. Save on insurance - Compare your rates on all your insurance policies. Ask how to lower premiums and any discounts they offer.

    4. Refinance your mortgage - Rates are still really low, but don't wait to see if they go lower. Take advantage now to lower your monthly mortgage payment. Check out BankRate.com to see if you can save money with a different rate on your mortgage.

    5. Check all fees - Don't pay for things you don't need, like that Netflix account you rarely use. Or avoid using out-of-network ATMs. Also switch to a credit card with a lower rate.

    (Source: Shine by Yahoo!)

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