The new year has finally begun! Now is the perfect time to plan which financial goals you would like to achieve this year. Here are some of the most common New Year’s financial resolutions, along with some tips on how you can achieve each goal to give your finances a fresh start.
Create and commit to a budget
Look at a budget not as an inconvenience but as a financial empowerment tool that you can use to improve your finances successfully. A budget gives you the power to track your spending and identify areas where you can afford to save, and show you where you need to reduce your spending. Avoid the challenge of finding a budget template on your own and create your custom budget using FinLocker’s budget and goals feature. When you enroll your financial accounts in your locker, you can track your savings and spending to attain any goal you would like to achieve this new year.
Live within your means to achieve financial stability
If you are looking to be more financially responsible this year, you can set a goal to live below your means. In other words, make sure that what you are spending each month is less than what you are bringing home in income. Being conscious of how much you are making each month can show you how much you need to be spending. Living within your means can be very manageable if you have a guide to follow. For example, the 50/30/20 rule for budgeting says you should allocate 50% of your income towards “needs,” 30% towards “wants,” and 20% towards savings.
Pay yourself first to grow your savings
Paying yourself a portion of your income is a great new year’s financial resolution, as it helps you achieve both short-term and long-term goals. Start from your first paycheck of the new year, and practice paying 10% of your income to yourself first. Invest in your “future” self by putting money into a retirement account, purchasing life insurance, paying off some of your debts, and creating an emergency fund. Using the pay yourself first technique at the beginning of the year will improve your financial well-being by the end of the year.
Raise your credit score to achieve your goals
Would you like to improve your credit score this year? There are plenty of ways to raise your credit score, and if you start now, you can end this year with a high score that can open up more opportunities for you. Paying bills on time, decreasing your credit card debt, making frequent payments, and asking for a credit card limit increase are all ways you can increase your score. You can make this goal attainable using FinLocker’s credit widget, which displays your Vantage 3.0 credit score and credit report provided by TransUnion. You can also track your credit history, access credit tips, and receive notifications when your credit score changes. Before making any credit-related moves or decisions, use the credit score simulator to test various scenarios to see how they could impact your credit score.
Increase your income by using your skills
Increasing your income, even a little, can provide the extra money you need to pay for monthly expenses. You do not have to get a second job to increase your income. Instead, look for opportunities where you can make a little extra cash in your spare time. You can create a side gig mowing lawns or walking dogs in your neighborhood, turn a hobby into a side business, or sell some of your unwanted belongings or clothes online or at a garage sale. Applying your skills or abilities to earn extra income may be just the thing you need this year to increase your financial stability.
Lower or pay off your debts
It is never too late to start reducing your debts. Lowering your debt balance is simpler to achieve when you have a plan to follow. You can follow strategies such as requesting a lower interest rate on your credit card, increasing your credit card payments, or making multiple payments every month, resulting in quicker results. When you enroll your financial accounts in your FinLocker, you can easily see your total current debts and see those debts reduced with each payment.
Are you ready to improve your financial life this year? Setting financial goals and committing to achieving them this year will give you more control over your financial situation and successfully prepare you for the future.