With the New Year just around the corner, now is the perfect time to start making plans for a financially healthy 2018. A great way to start is by reflecting on the financial successes and challenges you encountered during 2017 and using them to help you have an even better 2018, and beyond. Plus, according to the Stress in America survey published in November 2017 by the American Psychological Association (APA), 62% of Americans report being stressed about money. If you don’t already have a financial New Year’s resolution, now is a good time to make one.
As you reflect on 2017 and start creating your 2018 financial goals, here are some tips to help you along the way:
Create a budget and stick to it
One of the best ways to ensure you reach your financial goals is by setting a realistic budget and sticking to it. While a detailed monthly budget, including multiple expense categories, will help you better assess your progress, even a simple budget of total expected expenditures and income will allow you to measure your success or let you know to look for ways to cut back on spending. Be sure to include “savings” as part of your overall budget. Creating a budget will also allow you to see the bigger picture of what you have, what you owe and where your money goes.
Save for short-term and long-term goals
Your budget isn’t complete if you haven’t included a savings component. This is a crucial step that is often overlooked. Give some consideration to short-term and long-term goals, and then make a concerted effort to begin setting aside money for them. A short-term goal is something that is roughly within the next 2 years, like taking a vacation or paying off a loan. If you’re anything like me, the daily grind is far more manageable when I have something to look forward to in the not-so-distant future.
As for long-term goals, it is never too soon to start saving for retirement. The more money you put away earlier in life, the larger it can grow with compounding earnings. Other long-term goals might be the purchase of a home or new vehicle. Setting aside a little each month can go a long way in helping you achieve these goals. Remember, it takes discipline to achieve the goals you set for yourself. That often means sacrificing immediate gratifications for a greater good to come. While retiring at 60 might take you your entire career to achieve, some other long-term goals could be as soon as 5 years from now. Make sure to include saving in your budget and you’ll be ready when the time comes.
A New Year is also a great time to take a more detailed look at your expenses and to find ways to reduce your monthly obligations. There are many ways to save money without making major lifestyle changes. The first step is to write down all of your expenses. From there, you can prioritize these expenses to determine where cuts can be made. Perhaps that means fewer stops for coffee or buying generic products instead of name brand. It might also mean taking a closer look at non-essential expenses such as cable, season tickets and your gym membership. Many of these items accumulate additional and unnecessary surcharges, or you may not be using the service as much as intended. The key is to take a serious look at all your expenses and find little ways to make reductions. A few small reductions can add up to big savings over time, which can help you have a financially healthy 2018.
If you’re looking for more help reaching your financial goals, contact Mission Fed online, in a local branch or by phone 800.500.6328. Your success is our bottom line, and that’s why it’s our goal to help you reach yours!
The content provided in this blog consists of the opinions and ideas of the author alone and should be used for informational purposes only. Mission Federal Credit Union disclaims any liability for decisions you make based on the information provided. References to any specific commercial products, processes, or services, or the use of any trade, firm, or corporation name in this article by Mission Federal Credit Union is for the information and convenience of its readers and does not constitute endorsement, control or warranty by Mission Federal Credit Union.