The beginning of the new year is a great time to add some financial resolutions to your routine list of resolutions. Why financial resolutions you may ask? Because making and achieving them can make a difference in your personal finances in 2023.
Certified Financial Planner Board of Standards, Inc. (CFP Board) survey shows only 35% of American adults have a written financial plan. This means that the majority of Americans do not have a clear idea of their financial goals, nor do they know how to achieve them, or what steps they need to take to reach them. If you want to have a great financial year, then there are some habits to financial goals to consider this year.
10 Habits To A Having A Successful Financial Resolutions In 2024
1. Review Your Finances
Go through your financial statements from last year and see what you did right last year (victories) and the mistakes (misfalls) you made from last year. This will help you plan better for this year.
2. Write Down Your Financial Resolutions
Want to buy a car this year? Travel outside the country? Be free from debt? Start an emergency fund. Whatever your goal is this year, write it down. Adding the reason why you want to achieve the goal will act as an added motivation
3. Creating a Budget
The next stage is to start by understanding how much you earn. Then take note of how much regular expenses like fuel, transportation, school fees, data subscription and other monthly expenses costs. This will help you to know how much comes in and how you spend your money each month.
4. Save Something Every Month
Since you now know where your money goes, the next step is to evaluate how you spend your money and look for areas to save. Regardless of the amount, try to save something every month. Do you order food every day? Cook more at home. Do you spend so much on data subscriptions? Try to take a hobby so you spend less time online. Whatever it is, you may need to change some of your spending habits to achieve this.
Just in case you haven’t been saving before, now is the time to start.
5. Pay Yourself First.
Start by paying yourself first because if you pay yourself last, chances are you won’t pay yourself once you have settled other expenses. You can pay yourself by putting money into savings, emergency or retirement accounts.
Another way to pay yourself is by investing and reinvesting. Setup investments account for different goals like saving to buy a house, and early retirement. Investment can also be in buying gold, stocks, lands and other things that will yield returns over time.
6. Pay Fast, Buy Slow
One way to achieve your goals this year is to live by a simple rule ‘‘pay fast and buy slow’’. Be fast in paying crucial bills like rent, light, transportation, feeding and so on. This will help you know exactly how much money you have left. Then the ‘’slow’’ here means to minimize impulse buying. Have a pause period on when you first thought of buying something and when you actually buy it.
7. Have An Accountability Partner
To make sure you stay on track this year, get someone to hold you accountable for your finances. It could be a friend, loved one or colleague that will keep track of your progress in achieving your financial goal. It could also be in the form of helping you reduce the number of times you order out or go shopping.
8. Have Multiple Ways To Make Money
Sometimes, cutting down on spending just won’t cut it- you need to expand your streams of income. For instance, starting a side hustle like freelance writing or a POS business can be a great way to have more money to save, pay debts or even help pay for daily expenses.
9. Improve Your Financial Score
One way to have financial freedom and meet up with your resolutions is to be free from debt. If you cannot be completely free from debts, then try to improve your financial score. Pay your loans on time, whether it’s collected from friends or financial institutions. Take control of how much money you owe and work towards paying it off.
10. Educate Yourself on Financial Literacy
Learning more on financial literacy this year is one of the best investments you can make for yourself this year. It could be as simple as taking a class or course on how best to manage your money on budgeting, savings, retirement, etc. This will not only help you to achieve your financial goal this year but in years to come.
What other tips do you use or think we should add?