As 2017 rolls in, many of us are focusing on committing to goals that will help us achieve greater independence and success. One of the most important new year’s resolution that people focus on is achieving greater financial success, which can be found by changing money habits.
Very few people know where to start, which is why we’ve offered five tips that should help you set financial goals for the new year:
- Assess where you are: Whether it’s to save for a rainy day, pay off your credit card bill or reduce expenses, pick a financial goal that you’d like to achieve. Create a monthly or quarterly plan that will help you achieve those goals – but they key is to make sure they are realistic and achievable. For example: if you want to save $1500 next year to go towards your emergency fund, then your goal should be to put aside $125 every month to achieve that goal.
- Don’t splurge: Even though that jacket you’ve been eyeing at Zara’s may be on sale, ask yourself – do you really need an extra fall coat? For the upcoming year, try to monitor where and how you spend your money, especially when it comes to shopping. Reducing expenses by cutting down on impulse purchases can drastically help you stay within your budget and save money. Before you purchase something, ask yourself these three questions: Do I really need it? Can I afford it? How will I pay for it?
- Take a ‘pay yourself’ approach: Whenever you receive your paycheck, aim to pay yourself by transferring set amount to your savings account. It can be as little as $50, or as much as your wallet allows. The goal is to force yourself to save some money on the side (and yes, this is on top of the financial goal you set on #1).
- Kill extra subscriptions: Do you really need to subscribe to Netflix, Hulu, AND cable TV? The costs to subscribing to different services may seem small, but they start adding up quickly and may account for a chunk of your paycheck at the end of the month. Starting in January, reassess all of your subscriptions and see if you really need all of them. Go with the basics or the one’s that you use the most and get rid of the rest. At most, you will have to wait a while or get creative to watch your favorite TV show!
- Carry around cash: When we use plastic, it’s hard to keep track of how much you spend. Instead of using your debit or credit card, take out cash at the start of the month and use it to pay for everything. Use an envelope to store cash for grocery, gas, food, shopping and even entertainment. You are likely to be more cautious when spending cash and can reduce your spending drastically with this method.
- DIY (whatever you can): Your Facebook news feed is covered with practical DIY videos, so why not make use of them? From time-saving hacks to tech gadgets, you can practically make anything yourself at home with a few supplies. Not only does this save a little, you can also kill some idle time making things on your own and make a fun hobby out of it.
- Stay focused: setting budgets and goals are great, but these efforts are futile if you don’t have a plan to stay on track. Staying organized is a crucial step to meeting your financial goals this year. There are several tools and budgeting apps that can help you remain on track. Check out some of them here.