Happy New Year! I hope you ate lots of good food and spent time with family and friends this holiday season! Now that 2018 has arrived, let’s spend some time on those resolutions. I’m personally not the biggest fan of resolutions but it is a good opportunity to tackle some things you have been meaning to do. Just like the people who make a resolution to be more physically fit in the new year, I encourage you to also be financially fit this year. It’s not hard to get started but if you put in the work, it will be worth it. Let’s look at some ideas to get you started with your financial new year’s resolutions:
- Set goals – This should be a simple one to get started. Identify, quantify, prioritize those goals. Start with this worksheet on my downloads page. Don’t overthink it but just get something down on paper.
- Work on your budget – This will be an ongoing project but something so worthwhile. Whether you use an App, Excel or pen and paper, just start working on it. If you need some help, this post breaks it down to the basics.
- Establish a cash reserve – Having a cash reserve for emergencies is essential. Once you do your budget and figure out how much it cost you to live, aim to have 6 months worth of living expenses in that savings account for emergencies. Check out this post for more about why it’s important to have a cash reserve.
- Save for retirement – If you have identified retirement or financial independence as one of your financial goals, consider saving towards that goal via an employer-sponsored plan like a 401(k) or 403(b) or an Individual Retirement Account. Figure out which option fits your personal situation and start saving.
- Figure out ways to save more – Get creative with how you find ways to save more money. There are tons of ideas out there as to how to save more including this article from Mic.com and this one from Bloomberg.
- Seek professional advice if you need it – Don’t be afraid to work with a professional if you are ready for more formal financial planning or really want to get things organized. There are certified financial planners out there that can help you get a plan in place and lay out action steps.