Don’t you just love the start of a new year? New goals to meet, new priorities to set, and new habits to start. For many of us, the dawn of the new year also brings new resolutions to get our money in order.
Whether you are in the thick of paying off debt, investing more for retirement, or you’re struggling to live below your means, getting in full control of your finances is something everyone should want. The start of the new year is the perfect time for putting good habits in place to make sure we are being intentional with our finances and using our money wisely.
When we have good habits in place, it makes it easy to stay on top of things. Here are six habits to implement now to get your finances off to a great start.
1 – Set financial goals.
You have to know where you are going before you can get there. By setting goals in your finances, you give purpose to your spending and saving (and giving).
2 – Make (and stick to!) a budget each month.
Have a plan for you paycheck before it comes in. Look at all of your expenses for the month. Bills, oil changes, birthday gifts, special events, extra payments to debt. Each month might look different, but they should all start with sitting down and spending your money on purpose. Don’t wonder where it went. Tell it where to go! Check your bank account on a regular basis and make sure you are not overspending.
You can read my post 8 Steps to a Budget that will Actually Work if you this is an area you struggle with.
3 – Commit each month to get out of debt.
Part of sticking to a budget should be putting extra money towards your debt. Be intentional and pay things off early. Don’t get caught paying extra in interest! By paying things off early, you can take that extra money and invest it, earning money with interest in investments instead of losing money in interest from loans!
If you are dedicated to paying off your debt this year, you can read the step by step plan we used to pay off our debt.
4 – Track your progress.
Keep a running list of your goals and check them off as you meet them. Draw a debt thermometer to track how far you need to go, and to see how far you’ve come. Download the Debt Payment Tracker to log your payments. (You can find it in the Simple Finance Toolkit below!) Whatever you choose to do, figure out what will motivate you the most!
5 – Save for the future.
When thinking of investments, think long-term. Build up a savings account that will cover emergencies. Save an emergency fund in case you lose your job, or have to stop working for whatever reason. Most people shoot for 3-6 months of expenses. Then, invest in a 401K or a Roth IRA. Plan for the future and save for retirement.
If you don’t have a ton of extra money each month, start small. Even $50 each month adds up over the long run.
6 – Never stop learning.
No matter what stage you are in on your financial journey, you should always stay up to date. If you are trying to reign in your spending, buy books that show you different ways to budget or listen to podcasts that inspire you. If you are trying to get out of debt, learn from people who have done the same. Have dinner with a friend who has paid off dinner and pick their brain. Ask them what books they recommend! If you are wanting to build up your savings or start investing, scour the library (or Pinterest) for the latest and greatest accounts.
Use the start of the new year to get your finances in check. By keeping a couple of good habits from the start, you will be well on your way to meeting financial goals and using your money wisely!
What about you? What is one habit that keeps you motivated and on track with your finances?