Although it is obvious you can begin your way back to financial health at any time during the year, the beginning of the year is a perfect time to start as it represents a fresh beginning. It also ensures you have an entire year within which to make progress.
That said, if you get yourself off on the wrong financial foot, as it were, you can end up wasting time and more than a little money. With this in mind, your top 10 resolutions should focus on such things as perseverance, balance, and achieving simple goals.
When it comes to saving money, perseverance can be easier if you set up some automatic deposits into a savings account or IRA. Doing so takes the administrative chore out of actually logging into your online dashboard and trying to determine how much to transfer into your savings. Furthermore, many types of brokers offer incentives for first-time automatic deposits, so you might gain a slight advantage if this is your first time.
For this year, it might be best to focus on saving a reasonable amount of money across an impressive amount of time. Accomplishing this level of consistency is easiest if you establish goals of four to five percent of your net income. As you get more confidence, you can increase the amount you want to save. Additionally, as you become excited by how the compound interest adds up, you can then even diversify into a stock account or a certificate of deposit.
From a behavior analytic point of view, it is good to reward yourself for accomplishing small goals. Doing so helps instill the motivation to continue toward even higher goals.
As you slowly build your cash accounts, you should research your options. From stocks to mutual funds, you have an array of financial vehicles in which to invest. Knowing the difference between the big dogs and the runts can help you from losing money and sending you back to the kennel for more training.
Of course, one of the best things you can do to help your financial situation is to find a qualified advisor to help you articulate, identify, and reach your goals. Going it alone is never recommended when it comes to building wealth, so you should conduct an online search for Growth Financial Newcastle in order to locate financial advisors with experience helping people in your particular situation.
Of course, resisting temptation is not something you actively do like saving money, but avoiding the urge to dip into your cash reserves is a discipline that will have profitable consequences years down the proverbial financial trail.
Even if you fully intend to pay yourself back after dipping into your cash savings, events arise that can prevent you from doing so. Consequently, it is best to pretend your investments and cash reserves do not exist.
Examine Your Taste Fro Risk
Knowing your risk tolerance can help you avoid investing in a vehicle that might end up causing stress. Investing or saving money can be stressful enough. Consequently, you should ensure you know which opportunities represent your style of making money.
End the Debt
Using credit cards can end up costing you money in the form of exorbitant interest rates. However, even if you have low-interest rates, you will always have to make some sort of payment to bring your balance back to zero. This payment to a credit account does not pay interest or move you forward in any way. If you stop using credit, you can invest in this monthly payment instead.
You should invest in a budgeting spreadsheet that you keep on your phone or home computer. Doing so can help you identify spending trends. It can also help you manage account balances. Knowing your trends and balances can help you be proactive if your spending gets out of hand.
Additionally, a spreadsheet can often allow you to insert reminders of upcoming bills. Knowing when your bills are due can help ensure you never get behind, which can result in a past-due payment. Finally, a spreadsheet is an easy way to always get positive feedback when you hit your goals.
Living within your financial means is one of the best ways to free up significant income. If you have a problem with spending, the best thing to do is to adhere to the aforementioned advice to cut those credit cards. Additionally, you can get in the habit of buying off-brand products as they are often named products repackaged for a different market.