Each new year seems to arrive before we know it, but each one allows a fresh start to initiate new habits and practices that will better us in many facets of our lives. When we think of improving our lives, the first thoughts usually relate to our health. Of course, many will start with the conventional resolutions of eating healthier and exercising more. However, we tend to forget the impact that creating healthy financial habits can have on our overall well-being and the positive impact they can have in the long run. Here are a few financial resolution ideas to make 2022 a fruitful year.
Automate Your Savings
80% of people give up on their resolutions by February. Often, the lack of organization or discipline makes it difficult to meet or stick to a goal. A way to combat that is to put systems into place to produce the outcome you desire. For example, consider creating a savings account that automatically pulls a set amount every month or week. That’s a one-time decision you can make that’ll allow you to hit your savings goal every benchmark while keeping you organized to know how much money you have left for other expenses.
Create a Weekly or Monthly Spending Plan
If you’re having trouble putting together a spending plan, consider shifting your focus away from what you are restricting to what you are embracing. Rather than counting out morning coffee, or occasional retail therapy, create a budget that plans how you will take care of your necessary expenses and still leave some room for the things you enjoy. This plan should include the consistent amount you plan to set aside for savings, retirement, any loans, and necessities you have, while also leaving you with leisure spending money if possible.
Keep Track of Your Credit Score
Building credit is essential, but it can be dangerous if it gets left on the back burner. Because using credit doesn’t immediately affect your finances, it can be easy to forget to pay bills on time or keep track of your score. However, your credit score will play a significant role in your financial success and access to other financial benefits in the future. For example, a good credit score gives you access to savings on insurance, lower interest rates, higher credit limits, a wider variety of housing options, and more. Monitoring your credit score and ensuring you are not incurring too much debt will fuel your financial freedom in the years to come.
Create an Emergency Fund
If there’s anything we’ve learned throughout the past couple of years, it’s to expect—and prepare for—the unexpected. In terms of finances, creating an emergency fund within your budget and consistently allocating to it will allow you to have a cushion during unforeseen circumstances. During these unfortunate times, having an emergency fund to rely on will prevent you from completely derailing your financial goals in the long run.
Learn More About Money
Perhaps another one of your resolutions for this new year is to read more! Why not kill two birds with one stone and add a few books (or even audiobooks – they count!) about money and financial literacy? Here are a few of the most highly rated and best-selling books on finance:
- “The Millionaire Next Door,” by Thomas J. Stanley
- “The Intelligent Investor,” by Benjamin Graham
- “Rich Dad Poor Dad,” by Robert Kiyosaki and Sharon Lechter
- “I Will Teach You to Be Rich,” by Ramit Sethi
- “Transforming Your Relationship With Money,” by Joseph R. Dominguez and Vicki Robin
- ” Broke Millennial,” by Erin Lowry
Meet Regularly with Your Advisor
Every action item you can list to improve your finances over the year can be reinforced and supported by meeting with your advisor. Having a professional that can assist you in creating a personalized and achievable plan for your financial management will accelerate your goals.
By setting scheduled, regular meetings with your financial advisor, you will create a deeper sense of accountability in keeping up with the resolutions you set for yourself. At Idaho Medical Association Financial Services, our goal is to ensure you achieve yours. We offer fee-only holistic financial planning and retirement planning for doctors that will help you accomplish financial security in the long term.
To learn more or schedule a no-cost consultation, visit our website at Idaho Medical Association Financial Services or call (208) 504-1736.