Did you make financial resolutions last New Year's Eve? Did they fall by the wayside, along with the gym membership and your pledge to cut back on coffee? You are not alone. However, you still have time to make some progress on your financial goals.
Think back to the beginning of the year and the resolutions you made – or intended to make – and how much progress you made towards them. Chances are that they fall into one of these broad categories.
- Budgeting – Did you plan to make a budget and fail to do so? This is a perfect time to start, as you are heading into the shopping season. You may be able to stop yourself from holiday overspending if you realize how overextended you are.
If you have taken no other financial steps this year, start by setting a realistic budget. Most of the other financial improvements will follow.
- Control Spending – Even if you had a budget, were you able to stick to it? Start small by setting a spending budget for your holiday shopping. Use it as a psychological advantage – you have less to spend so you need to shop harder for bargains, comparison shop, and research prices.
Impulse buying and holiday sale distractions will be less likely to drag you off-track and your spending should be more focused as a result.
- Increase Savings – You had a savings goal – a down payment for a house, or an emergency fund – didn’t you? If you did not have a tangible goal, that may be why your savings effort failed.
Set a smaller savings goal now for the holidays, and use that small step as momentum to build a larger savings goal for the upcoming year. Make sure that you equate your savings with a tangible, specific goal – not just to say, "I will build an emergency fund for this year," but "I will build an emergency fund of $X by date Y". Let the free Retirement Planner by MoneyTips help you calculate when you can retire without jeopardizing your lifestyle.
- Reduce Debt – Did you plan to pay ahead on your mortgage? Is your credit card debt increasing? Debt reduction is an important goal, especially in the case of high-interest debt such as credit cards or payday loans. It is easy to get into an unrecoverable spiral of debt if you have no plan to keep debt in check.
It is a longer-term goal, but one you need to start right away. Attack the debt with the highest interest rate first and control your spending. That may be a tall task during the holidays, which is all the more reason to start immediately. If you want to reduce your interest payments and lower your debt, join MoneyTips and use our free Debt Optimizer tool.
- Wills/Insurance – If you have a family, it isn't all about you anymore. You planned to make a will and properly insure yourself to provide for your spouse and children, but it is such a depressing thought that you kept putting it off.
Do not delay any further. You have plenty of time to resolve this before the holidays, and plenty of joyous occasions to perk you up after considering your demise.
This time, don't wait until New Year's Day. Use the holidays to get your financial house in order. Establish budgets along with specific goals and the dates to meet them. You can build habits that will help you get through the holiday bill season and gather momentum to keep good financial practices throughout the rest of the year.
That is at least as important as going to the gym and cutting back on coffee – and frankly, more likely to happen. Wouldn’t you agree?
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