Even with the best intentions, it’s easy to realize at the end of the year that you made some financial mistakes over the past 12 months. Fortunately, every new year brings a chance to start again. Don’t face another year of wishing you were making more financial progress than you are. Instead, embrace these financial resolutions for the new year, so you end up in the position you want to be in in the future.
Build a Budget
Building a budget is one of the most impactful things you can do to manage your finances, but it is also a step that a lot of people skip because it sounds too time-consuming. In reality, there are plenty of free financial programs out there that will guide you through the process of building your budget quickly and efficiently. Once you put the time in upfront, your budget will run itself. Keep in mind that the point of a budget isn’t to restrict you financially. Instead, the goal is to give you more control over how you spend your money by making you aware of where you’re spending and how you could better allocate your funds.
Set Your Priorities
To get the most from your money, create a list of short-, medium-, and long-term financial goals. Next, allocate your resources in ways that bring you closer to those goals. For example, imagine that your short-term goal is to travel to a wedding next month and your long-term goal is to buy a new house in the next five years. You can adjust your entertainment budget to get ready for the wedding. After that, you can look into a high-yield savings account for putting aside money for a down payment.
Focus on Debt
While it is common to have some debt, it’s important to remember that the longer you hold onto that debt, the more it costs you. If you’re struggling with debt, look for ways to cut back so you can devote more to paying it off. Alternatively, consider a side hustle for extra income for payments. Focus on paying off accounts with the highest interest first, and resist the temptation to add new debt after you pay off balances.
