If you’re looking to make a fresh start in the New Year, diet and exercise are often the usual culprits for revamping. However, another area of your life that you might think about getting lean and mean with is your finances. There are a few financial resolutions you can make that will benefit YOU not only in 2017, but also for years to come.
Fix Your Credit. Decreasing your credit card usage is a good start. This is a hard one for many Americans but with the right strategy, it can be done. Using credit cards can help our credit if we make payments on time and only use 35% or less of the Credit Line. However using more and maxing out credit cards severely hurts our credit. Only use what you know you can pay off. Don’t let your credit usage rack up.
Get Out of Debt. Or at least, make a game plan to do so. Many Americans are making small payments towards their credit cards, student loans and other debts without actually knowing how long it will be before they are debt free. Take a lunch break to calculate your total debt, set a realistic deadline for when you would like to have all of your debt paid off, and determine how much you need to be contributing to pay off your debt each month. If you are still paying off student loan debt, look into consolidating your loans and lowering your interest rates.
Stop living paycheck to paycheck. You might not be able to accomplish this right out of the gate but start working towards living a lifestyle where you are not fully dependent on your next paycheck. Start putting away money to your savings and create a nest egg for yourself.
Retirement. Make saving for retirement a priority this year. With advancing technology and medical improvements, we are expected to live longer. This means, we need to put away even more money to sustain ourselves for a longer life. If you haven’t started saving for retirement, this is a good year to start.
Spend less than you earn. The most powerful thing you can do for your finances is spend less than you earn. Creating a gap between what you bring in and what goes out allows you to do something meaningful with your extra money, whether that is paying down debt, padding your cash savings or ramping up your retirement accounts.