If your new year’s resolution was to spend less and save more, but as you look at your checkbook from the past 6 months, you find your habits have not changed… you aren’t alone.
Research suggests, only 8 percent of people actually keep their New Year’s Resolution. However, January 1st doesn’t have to be the only time you rethink your finances. Mastering your money can come down to establishing a few smart habits, any time of the year.
By adopting these 6 easy money practices, you can revitalize your New Year’s Resolution and save hundreds of dollars in the process.
Investing is one of the most effective ways to grow your wealth. With the help of compounding interest, a small and consistent amount of money can quickly multiply. Whether you have $20 or $2,000 left at the end of the month, making your investments a priority helps you reach your goals, without stretching your wallet too thin.
Writing down your goals helps them become more tangible. Be sure your goals are realistic but don’t be afraid to challenge yourself to spend less, to save more.
Rather than spending your bonus check, birthday present, or other little extras throughout the year, use that money to pay down debt or build your emergency fund. It might not seem like a like a large amount of money, but it adds up.
Whether you use a spreadsheet, a checkbook, or a mobile app, tracking your expenses is one of the easiest ways to eliminate unnecessary purchases. An easy way to track your spending habits is color coding purchases, denoting expenses such as entertainment, meals out, clothing, and non-necessities. By bringing attention to these expenditures, you can better track and manage the amount you spent, and even cut unnecessary costs.
You may be asking yourself ‘Which loan should I pay off first?’ Well, as simple as it may seem, the one with the highest interest rate. Because of the effects of compounding interest, your high-interest loans can quickly grow and take years to pay off. By making additional payments to the one with the highest interest rate first, you can eliminate hundreds of dollars in interest.
It can be difficult to remember to pay your quarterly taxes or make an appointment with your financial advisor. Just like you make a calendar of events and appointments you must attend monthly or yearly, make a calendar for your financial obligations. Mark all your important money events, such as when payments are due, your pay period, and reminders about your semi-yearly or yearly appointment with your financial advisor. This will keep you on track and you will not have to worry about late fees or overdue bills.
Being wealthy is not about having a lot of money, it is about making smart decisions with the money you have. By implementing these 6 smart money habits into your daily life, you can take control of your wallet and grow your wealth.
To learn more or for professional advice, contact a member of the Duncan Financial Group financial services team.