“I don’t believe in New Year’s resolutions.” Has anyone else been hearing this lately? Keeping a resolution has nothing to do with calling it a “resolution”, but it has everything to do with our self-discipline, accountability, and motivation. Call it what you want; the outcome is on YOU.
We are here to encourage everyone to challenge yourself in 2018, whether you call it a goal, resolution, or nothing at all (you do you). And in the spirit of challenges, there is no better time to make financial goals than the beginning of the year; you have a fresh slate to plan from. Here are 5 simple steps to cleaning up your personal finances in 2018:
1.Track every expense.
Why do you think Weight Watchers works well for so many people? There is an obvious change in thinking when tracking each and every ounce of food. Is it easy? Heck no! It’s hard work. In the beginning of cleaning up your finances, it is important to understand just how many unnecessary & necessary transactions are going out of an account on a monthly basis. And, thanks to the internet, every free resource in the world is at your fingertips to help make life a little simpler!
2.Create a debt plan.
Next up, write down all of your debts- everything from your credit cards bills to your auto loan. There are two things to consider. First, check out your interest rates. Most likely, the credit card rates are in the double digits. Consider visiting a financial institution (we know a great one) that has low interest rates on credit cards where you could transfer your high-interest balances to one low interest rate.
Next, consider how much debt you can handle paying off monthly. Then, decide what method will be used. A debt snowball will be paying off the smallest debts first; a debt avalanche will pay off the highest interest first. Once again, there are many resources online for both of these concepts to research more.
We can all push ourselves a little more. Could you save 15% of your income? It would be a push, right? But, do the math on how much you will save with 15% in an account; trust me, it will be a great motivation! Saving more will not only prepare you for emergencies, but the cash on-hand will help you stay out of debt.
I have heard a parent say to their child that they don’t have enough money to pay for a toy. Do you know what the child said in response? “Just swipe your card, Mommy.” Once again, part of cleaning up your finances is a mental game. Watching the cash leave your wallet will be much more impactful than continually swiping a card.
You can’t do this alone. Find a partner. If you’re married, congratulations! You have a built-in accountability partner. If you are not married, find a trusted friend, parent, or co-worker that will check in with you. Intentionally choose someone that prioritizes their personal finances, too.
If you are looking for even more help with your personal finances, the ēCO Credit Union Foundation is hosting a financial seminar on the morning of January 27 at the Hoover Public Library. Mark your calendars for a great (& free!) event to learn everything you need to know about your finances and how to start your budget! Like us on Facebook, and then browse through our events coming up to find out more. (Registration is requested.)
Written by: Georgia Hux
Georgia Hux is the Marketing Coordinator at ēCO Credit Union. She is wife to Aaron, fur-mom to Tuff, and thinks Joanna Gaines is her best friend.
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