The New Year is always a time of reflection and for looking toward the possibilities the new year will bring. This is the time of year we take personal inventory and identify opportunities for self-improvement and creating a happier life. As Financial Coaches we love this time of year! We feel inspired to have open conversations, sharing dreams and goals with friends and family. Reflecting on wins, losses, and plans for trying again in the next 12 months. Specifically when it comes to New Year resolutions for your money or personal finances.
One of the most popular New Year Resolutions is to “Save more money”. But if you’re read our piece on How to set (and reach) Financial Goals – you know that resolution is too vague to get you anywhere.
So what are good New Year Resolutions for your Money? Here are a few ideas to get you thinking about your resolutions and to help you start the conversation with your friends and family.
New Year Resolutions for your Money
Focus on Financial Well-being
Health and wellness is a part of most peoples New Year Resolutions, but have you ever thought about the role your finances play in your health? Financial stress can negatively impact your emotional, mental and physical health and can even be to blame for binge watching so much Netflix, stress eating, skipping the gym and feeling anxious, stressed and even depressed. However, by treating your financial plan with the same respect and attention you give to the other components of a healthy lifestyle, you will find your health and well being improved!
Get out of Debt
Do you have student debt you would love to get rid of? What about a car payment you are tired of making every month? Are credit cards more hindrance than help? This year, work towards making debt a thing of the past. Start creating a life free from debt rather than putting your life on hold while you slowly pay off your student loans (and all the associated interest) for 20 years. Check out the best way to get out of debt and eliminate your debt faster!
Boost your Career
3 in 4 Americans are stressed about their finances and it shows in how well we perform at work. Many of us are distracted and anxious, wondering how we are going to stay afloat. Not meeting our true potential for productivity, creativity and inspired ideas!
You don’t need that! You have things to do today! So boost your career by taking the financial strain out of the equation. You will be surprised how much of your brainpower you will get back.
Build an Emergency Fund
One of the most crucial steps following getting out of debt is staying out of debt. Enter the Emergency Fund. Having an Emergency Fund gets you one step closer to true financial freedom – making it one of our favorite New Year Resolutions for those seeking financial well-being! Think about it – rather than getting back in debt when you have a rainy day, you simply pay cash and move on.
Kept liquid and accessible, this money is separated from your checking account and is used instead of a credit card for rainy days and true emergencies. We recommend 3-6 months worth of living expenses as your goal and suggest using a Money Market account vs. cash or a savings account that earns little to no interest.
Invest in your Marriage
The numbers don’t lie. Approximately 25% of divorce is due to financial troubles or “financial infidelity”. But these money fights are 100% preventable! By building a financial plan with your spouse and working together to achieve your goals, you can bring financial security to your home. Not to mention, all of the other benefits mentioned above! It truly is a recipe for a happier relationship.
BONUS: Here are 6 ways you can save money in the new year!
Happy New Year everyone!