Most of us have made at least a few New Year resolutions in the past that didn’t pan out. That commitment to go to the gym every day quickly turns into a forgotten gym bag of workout gear stuffed in the guest closet.
When it comes to your finances, though, it’s essential to make those commitments stick. This means looking both backward and forward to assess your financial performance last year, and what you want to achieve in the coming year.
Creating a financial checklist is a simple, proven way to ensure progress. Writing down your goals will help keep them “front of mind,” motivating you to direct energy toward achieving them every day.
Adding these activities to your checklist can help you avoid costly errors and discover opportunities to strengthen your financial future.
Review your past financial year.
Given that the pandemic disrupted millions of lives and practically every industry imaginable, you may have fallen short on your financial goals. Fortunately, though, you can take lessons from last year’s experiences and apply them to your future financial plans and strategies.
Reset your budget.
Starting fresh with a budget helps you track all of your income and expenses. This allows you to easily make adjustments to save more of what you earn.
Your budget may look quite different from last year, when entertainment and dining options were still hard to come by. If you’ve become accustomed to dining out less often and choosing less expensive entertainment options, continuing to do so could help you divert more cash to savings.
Save through automation.
One of the simplest ways to save more money is automating the process. It’s hard to discipline yourself to move money into a savings account every week or month, but you won’t miss the money if it’s done for you.
Put your bills on autopay.
Today’s world is relentlessly pelting us with distractions, which means even the most careful consumer can forget to pay a bill now and then. A late bill, though, could cost you in terms of late fees, additional interest charges, and other unnecessary expenses. Setting up autopay for each of your accounts ensures that you won’t give up your earnings to late fees.
Boost your retirement contributions.
Retirement savings can earn interest, but they may also provide tax savings to strengthen your finances. Contributions may be tax-deductible, and growth is often tax-deferred until proceeds are withdrawn from the account. You might aim to set aside 10 to 20% of your income for retirement. If that’s too big of a chunk, start with a more comfortable percentage and increase that amount by 1% each year.
Please contact one of the experienced financial professionals at PS&G Financial Partners with questions. Our entire team welcomes the opportunity to be of service.