It's now 2020, a number synonymous with clarity and vision.
So what better time to take a good, hard look at your finances?
Consider making a resolution to save money, one of the best ways to secure many happy new years ahead.
Saving money is hardly a unique idea. It ranks in the top five of new year’s resolutions, according to polls. Making a resolution is easy. But how do you actually keep it?
Here’s five steps you can take to improve your chances of keeping your financial resolutions in 2020:
Make savings a mandate on payday.
We all know that a portion of every paycheck should be allocated to savings. The simplest and easiest way to do this is to have automatic savings withdrawn from every paycheck. You can’t spend what you don’t have, so take some money out of sight, out of mind and put it toward your financial future.
Any windfall — overtime, bonuses, an annual raise, monetary gifts — can be added to those savings. You know you can live within a budget, so any extra should plump your savings accounts and not your already sufficient pockets.
Review your Insurance policies.
Car insurance rates are set by a complex formula that can include your credit score, claims history, zip code, make and model of the vehicle, and even your marital and homeowner status.
Life situations change, so every year it makes sense to check in with your insurance company to see if your fees can be reduced. Ask about your homeowners insurance as well and see if bundling them together would help.
Hanscom Insurance Agency, LLC, can help you make sure you are getting the best deal possible. Give them a call at 800-632-9887, and they can review your current coverage and make recommendations that could save you some serious cash.
And of course, if you are able to save a few dollars, put all of them right back into your savings.
Read your financial statements carefully.
Mistakes happen. You could be double-billed for something you ordered, or find that a refund hadn't been applied to your account. You could also notice fraud on your account...but you won't see it if you don't check your statements regularly. Review all of your statements carefully for possible errors and report them immediately. The sooner you can raise alarms, the better the outcome for your finances.
Checking statements on a regular basis also gives you good data on what you are spending, where you're spending it, and offers a big clue on why you're spending. That can be a catalyst to recognizing what spending patterns could and should be changed to generate more cash for savings.
Spend five minutes a day learning about money.
Read the financial section of the newspaper regularly. Skim a chapter of a well-reviewed financial how-to book. Set a goal this year to finally understand investment terms like "dollar-cost averaging" and "the rule of 72." And of course, subscribe to MoneyWisdom, the financial education blog you're reading right now. Just click on the subscribe button above.
Knowledge is power. The more you understand how your money can multiply, the less likely you are to make random purchases and the more likely you are to add the difference to savings.
Make change with change.
What’s in your couch cushions? Or under your car seat?
Do a daily search for loose change and drop your found coins in a container.
My coin collector is inscribed with “Retirement Fund.’’ This reminds me that while I can’t retire on what’s in that coffee can-sized canister, the more I deposit those coins into my account, the more steps I am taking, however small, to build financial security.
Keep your goals in focus, Not someone else's.
To have 2020 vision, you have to close your eyes sometimes.
Social media explodes around us, showcasing magical vacations, brand-new top-of-the-line vehicles, and sparkling kitchen renovations that would make celebrity chefs weep.
They all look nice. But what does not look so nice is the debt some people carry to make those dream-like visions a financially painful reality.
Keep your eye on your personal financial goals: What you have and what you hopefully don’t have (high debt). Don’t get tripped up by the lifestyle of others.
Remember: There is always someone better off and worse off.
Here's the best resolution you can make: Appreciate what you can afford, save as much as you're able, and savor the priceless blessings of family and friends. That way, 2020 will bring self-contentment.
Learn how to take control of your finances! A sound spending and savings plan is the foundation for your long-term financial success. You'll find the plan you need in our free Money Management Planner!
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