The new year brings a promise of new beginnings and starting fresh. Financial goals consistently rank as some of the top resolutions. Improving your financial well-being can be overwhelming no matter how committed you are. Here are five tips to help you get started:
- Set a budget and stick to it
Budgeting is the basis for any healthy financial resolutions. Set a realistic budget and be sure to include housing, food and utilities.
- Pay off debt
Don’t let debt keep you from achieving your financial dreams. Two common methods of paying off debts are the avalanche method, where debts with the highest interest rates are paid off first, and the snowball method, where the smallest debts are paid off first. Find out how much interest you may save by using one method over the other.
- Save for retirement
It’s hard to imagine saving for something that’s 20, 30 or 40 years away. But saving early can increase your retirement savings by thousands of dollars thanks to compound earnings.
- Build emergency savings
Experts agree you should have two to three months’ worth of expenses saved. It may take a while to build up, but financial freedom is worth the wait. Check out our guide for practical ways to help you start saving.
- Track your spending
You may not realize how much your morning latte or twice-monthly movies add up, but they do! Tracking your spending will help you identify where you’re spending your money and ways to save. The key is finding alternatives to treat yourself once in a while and still save money.
This information is presented for educational purposes only. It is not intended as, nor should it be construed to be, legal, financial or other professional advice. Please consult with your attorney or financial advisor to discuss any legal or financial issues involved with credit decisions.