Many of us begin a new year with optimism and good intentions, only to find old habits are difficult to change. One approach that seems to offer a better chance for sticking with the plan for improvement is to set specific, realistic goals that can be tracked and relative success measured. For instance, instead of proposing, “I’m going to lose weight,” or “I’m going to look like I did in high school by next year,” try, “My goal is to lose two pounds each month.” That way, even if you fall sort a couple of times, you can lose 20 pounds in a year. Similarly, try these five financial resolutions that are realistic, measurable and, if followed, can make your financial future look a bit brighter.
- Write out a realistic budget and stick to it – This may require a little time to examine the past year’s expenditures to make sure all items are covered, but to work, a budget has to be inclusive but realistic. A budget that is too severe will quickly prove unworkable and will be abandoned.
- Increase the money in your emergency fund – Most experts recommend a minimum of three months of bills to be set aside in case of an emergency, but six months provide more security and should be the goal.
- Increase the amount you are saving for retirement – Independent savings for retirement cannot be overemphasized. The earlier you begin the better, because time is the most important factor in creating wealth, but it’s never too late to start.
- Pay down your debt – Most people will have a home mortgage for most of their life, and unfortunately, that may also be true for student debt. Although these are considered acceptable forms of debt, paying them down can provide further opportunities to save. Definitely avoid credit card debt and get rid of it as soon as you can.
- Monitor and improve your credit – A good credit score can save significantly in allowing you to qualify for the best interest rates. It is not all that unusual to find errors in your credit file, and requesting a copy of your credit report from all three major reporting agencies once a year is free.
Spinnaker Investment Group understands the journey to achieve financial security is a long one filled with hard work and discipline, but you don’t have to go it alone. We can assist you in the effort to reach your personal goals by tailoring an individualized plan just for you. Contact us today.