Financial Resolutions for 2018
If 2017 wasn’t your year financially, don’t fret. We’ve got 8 financial resolutions ready for you to put in place to ensure you become strong in your finances in the new year.
Make your goals SMART: Specific, Measurable, Achievable, Relevant, Timely
The first step in setting financial resolutions for the new year is to take some time to sit and define what you hope to achieve financially in 2018. Rather than creating a vague, unmeasurable goal like, “I want to be debt free by 2019,” make your goal SMART. If you’d like to pay off your credit card, for example, you can declare, “I want to pay down my Visa card to $0 by January 1, 2019, and will contribute X amount from each paycheck every month to do so.”
Prioritize Any Debt You Have
If you’re like most people, you are entering a new year while still bound to old debt. It is important to understand, though, that not all debt is alike. Some of your debt may be causing more of a financial strain than others, like credit cards with high-interest rates, so taking time to dig into your debt and prioritize what needs to be paid off first will help you to gain some control of your financial strains in the new year.
Calculate your Income vs. Expenses
Have you done the math? If not, now is the time to sit down and evaluate your income each month along with how much you are spending. This is a great time as well to gauge your expenses and figure out where you are being frivolous. If your income does not outweigh your expenses, it may be time to consider asking for a raise at work, taking on a second job, or adjusting your lifestyle to live below your means.
Make a Commitment to Pay Yourself First
What is the first thing you currently do when payday rolls around? Are you paying yourself first and foremost and investing in your own future? If not, this is truly an important goal to set for 2018. Having a financial cushion set aside for emergencies or unexpected expenses can help save you from financial distress. Start by opening a new savings account at your bank and set aside money each month to help build your rainy-day fund.
Invest in your Future with 401k
Do something your future self will thank you for. While investing in a retirement fund may not be the most exciting way to spend your hard-earned paycheck, it is crucial to ensure your future is secure. Think of it as very delayed gratification.
Keep your Credit Healthy
Just as you are likely focusing on building healthy habits for yourself in the new year, building healthy credit habits is important too. Having solid credit can help you to achieve some of your biggest financial dreams – like owning a home of your very own! That is why it is important to build credit and maintain healthy habits early on like making ALL of your payments on time, keeping your balance low, and checking your credit score often to ensure you are staying on track. If you’d like more tips on how to build and maintain healthy credit, contact your local Inlanta Mortgage financial expert to discuss your situation today.
Turn on Auto Payments
If you haven’t done so already and are struggling to save money, setting up auto payments that automatically transfer money from your paycheck to your savings account can help you build your savings. This may look like your account is taking a hit at first, but soon, you will adjust and be glad you did it.
Follow the 50/20/30 Rule
Have you heard of the 50/20/30 rule? If not, there’s no better time like the new year to start a new tradition! The 50/20/30 rule involves using 50% of your income for “essential living” (this means paying your rent, utilities, groceries, car insurance, phone, credit card, etc.), 20% goes to financial goals (savings, retirement, investments, etc.), and finally, 30% goes to your personal spending (yes, you still get to have a life!). To learn more about this method and how to put it to good use, check out this article from The Penny Hoarder today.