Most of us, really deep down, know that New Year’s Resolutions are a complete waste of time. If someone asks about your resolutions early in the year, you might come up with something that you vaguely want to change or improve in your life. But, the reality is often that you don’t mean it, it’s not realistic, or it’s something that you don’t really want. Our resolutions are often based on our dream lives. We don’t put much thought into them, and they stay forgotten in January.
Even if it is something you want to achieve, it’s going to take more than an announcement at the start of a New Year to get you there. You need smaller goals and achievable targets to help you. You need to break it down and make a plan to help you get what you want from your year. You can’t just say “I’m going to save money” and hope for the best. You need to look at how much you can save, you need to budget and set goals, and you need to find ways to save.
Money is often the focus of our resolutions. We want to make cutbacks. We want to clear debts. We want to save or take greater control of our finances. But, these are all quite vague, which is often why they are forgotten. Let’s look at some more detailed finance resolutions that are worth making.
To Have Less Debt by the End of the Year
In the ideal world, we’d all love to clear our debts within the next year. Debts cost you money. They can be bad for your credit report and having them means that you can’t get more credit if you really need to. But, paying all of your debts off within a year is unlikely to be a realistic target. Especially if you’ve got a large debt, more than one, or you are still paying off the minimum each month.
Instead, look at what you can afford to repay right now. Assume that you’ll be able to pay that all year and set yourself a target. This might be to pay 20% off a credit card or to pay 30% off the debt with the most interest.
Start the year by exploring your options. Could you consolidate your debts? Or move a balance on to an interest-free card? You could give yourself a big head-start on your resolution with the right choices now.
To Create a Household Budget that You can Stick to
Most of us live without a household budget. We set up direct debits for bills, we send our paycheck to that account, and we hope for the best.
Setting up a household budget can help you to manage your money. You’ll be able to see what you are spending and where, and get a clear idea of how much you could save or pay off debts. You’ll also be able to see where you could be making cutbacks or spending less.
But, you don’t want to make it that complicated that you can’t follow it. Set up a simple budgeting spreadsheet, and make sure you update it and check it whenever you need to.
To Explore Your Investment Options
After paying debts off, investing your money should be your next financial resolution. Look into your investment options, visit our website here to find out more about handling poor advice and speak to an advisor. If you’ve never invested or even saved before, focus on small amounts and exploring your options in the next year.
To Use Your Piggy Bank
It doesn’t need to be a piggy bank as such, a jar or pot will do as long as you use it. Look at penny savings challenges and find one that you can afford. Perhaps saving anything less than $1 in your jar. Make sticking to your challenge your resolution and enjoy watching your pot fill up.
To Monitor Your Credit Report
Your credit report is essential. Your credit score determines what you will be able to borrow in the future. Companies use your credit report to determine how reliable you are, and a high score gives you more options. In today’s world, most of us check our score online, but we rarely make the effort to read and monitor our report. Make your resolution this year to check your report each month and work on improving your score.
Make More Money
Having more money is the ultimate goal for many of us. Saving, clearing debt and investing are great ways to do it. So is earning more. Look at gaining promotions and pay rises at work, and consider side hustles to make extra.