Level Up Your Finances in the New Year

How to Set [Financial] Resolutions:

When setting New Year’s resolutions, financial or otherwise, it’s important to realize that success won’t happen overnight. Anything worth achieving requires a plan, hard work, and commitment.

Before you jump right into pursuing a new goal, take time to plan thoroughly. Use the following tips to help you get started:

• Be Intentional:

Ask yourself what goal is most important to you. Why does it rank high with you? Continue to ask yourself “Why?” several times to uncover your true goal.

For example, you might state your goal is to “save more money.” Why do you want to save more money? Is it for a specific purpose, like a new car or summer vacation? Are you tired of living paycheck-to-paycheck? Do you spend frivolously and impulsively? All these answers can help tailor your goal.

If you’re living paycheck-to-paycheck, perhaps your goal shouldn’t be to “save more money” but to look for a higher-paying job. Or maybe you need to reduce expenses to live more within your means.

Being intentional with your goals is the first step to identifying the process you need to take to achieve them.

• Get Specific:

You’re more likely to accomplish a goal if you are specific in what you hope to achieve. For example, instead of just saying, “I want to save more money,” work to identify the amount, reason, and timeline. “I will save $5,000 by August 1 as a down payment on a new car.”

• Remain Realistic:

Setting unobtainable goals will only cause you to give up quickly. If you want to save $5,000 in a few months but only have $100 leftover monthly, you’ll likely ditch the goal after the first several weeks.

Review what you want to accomplish and the timeline you set for yourself. Just as it’s extremely difficult to lose 30 lbs. in a month, you don’t want to set the bar so high that it’s impossible to reach.

• Devise a Plan:

Once you have intentionally set a specific and realistic goal, it’s time to create a course of action. How can you accomplish this goal within the timeline you set? Often, there are multiple means to advance a goal.

For example, assume you set a goal to save $250 each month for 6 months. However, you only have $150 leftover monthly to save. Look for opportunities to make it possible. Perhaps you can reduce your expenses by $50 a month. Maybe you can perform a freelance job monthly and bring in an extra $50. If you have outstanding loans, improving your credit score could allow you to refinance at lower rates and reduce your monthly payments.

Explore all opportunities surrounding your desired goal. Then, create an actionable plan to ensure it’s achievable.

• Hold Yourself Accountable:

When working to improve oneself, it can be challenging to hold yourself accountable. You might fail to follow your plan after a few weeks, find it too challenging, and ultimately throw in the towel. There’s no downside other than letting yourself down, which may or may not be a significant motivator.

Instead, find ways to hold yourself accountable. Teaming up with a friend or family member is a great way to start. If you have a gym buddy, you’re more likely to go so that you don’t let your friend down. It’s the same with financial goals.

If your friend is working to save money, encourage one another and have weekly check-ins. When you hang out together, make intentional decisions to avoid costly entertainment like dining out or splurging on frivolous stuff.

• Prepare for Setbacks:

The final step in setting goals is to plan for setbacks. Perhaps a financial emergency arose, and you couldn’t put any money into savings that month. Whatever hurdle you’re facing, create a plan beforehand to overcome it.

If you’re trying to lose weight and you go out with friends and have a cheat meal, you shouldn’t give up hope. Review what happened and find ways to avoid that situation in the future. Perhaps, if you know you’re going out with friends, you look at a menu ahead of time to ensure your meal fits within your eating plan.

It’s the same with financial goals. If you cannot meet your saving goal that month, how can you make it up? Is it possible to move your timeline out a bit further? Are there any additional expenses you can cut? Can you take on extra hours at work to make up for the difference?

Remember, your goal is progress – not perfection. There will be setbacks, but how you approach them is what matters most.

¡Estamos aquí para ayudar!

Obtaining your financial resolutions in the new year stems from your ability to set intentional goals that are both realistic and specific. From there, you can devise a plan to tackle your objectives and add tools to simplify the process. Remember, your goal is progress, not perfection.

If you want to learn more about the financial tools available to help you achieve your goals, we’re ready to help. Please stop by any of our convenient branch locations or call 888-777-9982 to speak with a team member today.