It’s not too late to start setting those New Year’s resolutions, and finance is always a popular focus for many. But if you’re stuck on what resolutions to set, here are ten ideas to help you improve your financial health.
1. Find the right budgeting method for you
If you have a tendency to overspend, one of your resolutions could be to find the right budgeting method for you. Budgets are hard to stick to, so it’s vital that you find one that fits in with your lifestyle. Try out methods like 50/30/20, the envelope method, 80/20, or one of the many other methods out there until you find one that sticks.
2. Cut one unhealthy spending habit
A lot of us have unhealthy spending habits. Perhaps it’s morning caramel lattes or takeout pizza. Whatever it is, make it your mission to either limit it or stop it altogether. A good way is to count how much you’ve spent on the habit over the past few months and imagine that going into your savings account instead.
3. Create a debt repayment plan
If you’re stuck paying off several debts at once, aim to make the year you make a real dent in those debts. Prioritize high-interest and high loan amounts first and pay more on those to clear them faster. Then you can move on to the next one and the one after that, gaining momentum each time you clear a debt.
4. Automate your savings
Don’t leave your savings until the end of the month. Instead, automate them as soon as you get your paycheck. Many modern banks let you set up automatic payments to savings accounts so it leaves your main account before you’ve had a chance to spend it.
5. Improve your credit score
If your credit score is looking a little worse for wear, make the year you focus on repairing it. There are a few ways to do this including creating a solid debt repayment plan, refraining from applying for too many accounts, and lowering your debt utilization ratio.
6. Look for another income stream
If you want to boost your income, a side hustle is an increasingly popular way to do so. There’s an endless number of opportunities to make money on the side, whether it’s offering freelancing services, becoming a business partner, or starting your own Etsy store.
7. Aim for a salary increase
The New Year is a great time to start thinking about increasing your salary. You can do this in two main ways – asking for a pay raise or looking for another job. If asking for a pay raise, make sure you’re armed with a case to explain why you deserve it. However, sometimes jumping to another job is the best way to increase your salary. So don’t be afraid to start on a new path this year.
8. Start an emergency fund and regularly contribute to it
If you haven’t already, starting an emergency fund is a great way to improve your financial health for the New Year. You never know when a sudden repair bill or emergency expense is going to appear, so having a buffer is so important. This stops you from relying on payday loans or dipping into savings accounts. Even if it’s a little, try to contribute a regular amount each month.
9. Prioritize retirement savings
A lot of people don’t even think about retirement, especially if it’s a long way off. However, the best time to think about it was yesterday, the next best time is now. If you haven’t already, make sure you sign up for any workplace retirement accounts and take advantage of employer contributions. Aside from that, look into private pensions and investments to help secure your financial future.
10. Make an action plan for your top savings goal
Do you have a savings goal lurking in the back of your mind that you’ve never quite managed to hit? The New Year is a great time to put a solid action plan together. Set a solid savings goal, a time to hit it, and a plan for how you’ll get there. Make sure it’s realistic and break that goal down into little pieces.
For example, if you want to save $1,000 for a big vacation, divide that by the number of months between now and your target date – that’s your monthly savings goal.
The New Year is a perfect time to start creating positive money habits and these resolutions should help you secure your financial future and boost your financial health.
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