new year finances

New Year, New You? How About a new Financial Plan as Well?

The New Year is the ideal time to set up some new financial goals for your family, but it’s essential to start with smaller goals that will help you work towards those that are bigger over time. Regardless of the financial goals you intend achieving, it will be a good idea to set up a support system that will help make it easier to achieve them. 

Below are some examples of financial goals you can consider setting for your family:

Compile a Realistic Budget

Several individuals who earn six figure paychecks still struggle financially because they don’t take the time to compile a budget for their money. As such, setting up a realistic budget will probably be the most important step you can take if you intend being financially successful. 

Although it might seem intimidating to compile a budget for the first time, you shouldn’t let this stop you from doing it. Tracking your income and expenses will not only help you understand your finances better; you’ll also be able to plan ahead for any major financial decisions that may need to be made. For instance, perusing your spending will help you differentiate between genuine needs and wants – which will result in a change in your spending habits over time. 

When compiling your budget, have copies of bank account statements on hand because this will help you see exactly where your money is being spent each month. If you find that expenses are exceeding your income, you’ll either have to cut items out of your budget wherever possible or find ways to earn additional income to cover the shortfall.

Repay Consumer Debt

The next financial goal to set should be repaying any consumer debt you have from store cards, credit cards and any other places where you’ve been making purchases on credit – and your budget will go a long way in helping to achieve this. 

Most financial experts recommend listing debts from smallest to largest, paying as much as possible towards the smallest amount owing and paying minimum required amounts on the rest each month. As the smaller debts are fully repaid, the amounts that were being applied to them can then be rolled over to the next outstanding bill in line.

Start a Savings Account

Up to 60% of Americans have noted that they would struggle to cover a $500 emergency if it arises because of not having any money saved. 

Once your debts have been fully repaid, place the money you were paying towards them into a dedicated savings account until you have approximately three months of living expenses accumulated. This will provide a lifesaving financial cushion in the event of possible job loss or other emergency that may occur.

If the idea of setting financial goals is leaving you feeling overwhelmed, it may be a good idea to schedule an appointment with an accredited financial advisor. Contact us today if you would like to learn more about taking control of your financial future.