With our busy lives, it’s easy to wake up one day realizing that months have gone by and you have yet to make a dent in your New Year’s Resolutions! Fear not, as it’s always a good time to start reaching your goals.
You may have a list of excuses and concerns, but they are just small roadblocks in your quest for success. If you’re like the majority of Americans with battered finances, you need to realize that taking some action is better than no action at all. Roughly 75%-80% of Americans live paycheck to paycheck, which means most of your friends and family are likely in the same boat as you. Furthermore, 40% of Americans don’t even have $400 in the bank to cover an emergency. I’ll mention that people working with a financial planner are less likely to fall into either category.
Why are so many people struggling in the best economy we’ve had in a decade? There are plenty of reasons. Despite the extremely helpful Tax Cuts and Jobs Act compliments of President Donald Trump(read my review on how it impacts you), many state and local governments continue to increase taxes on the everyday, hard-working American. When one giveth, another taketh. This has caused many people to feel as if they have received no federal tax break at all. Rising property, sales, and state income taxes, not to mention higher “fees” for services, all have a big impact on what’s left for hard-working families. Also, the amount of debt being carried by households is staggering, particularly student loan debt among millennials.
It’s now widely accepted that millennials are delaying home buying and marriage and children in order to get their finances on more solid footing. Undoubtedly, many are underemployed, which further exacerbates the situation. I’ve helped clients work through their student loan and other debt obligations so they can breath a sigh of relief.
So, as we move further into the year and everyone heads back to the gym and renegades on their diets, here are some personal financial resolutions you might want to make.
- Bulk up your savings. No matter how much you’ve stashed away, save more. Whether you’re buying a home this year or just trying to save up for a future down payment, having more cash on hand gives you options. And, if a recession is looming, you’ll be grateful for every penny.
- Pay down debt. If you can’t save money(tip #1), then this is your next step. Punching your debt in the face will lead you to that early knockout blow in round 3. Paying less interest over time means more money for you. I help my clients develop a variety of strategies to allow them to pay off their debts faster. This includes navigating the Public Service Loan Forgiveness(PSLF), refinancing, and more. So, make this the year you get all Rocky Balboa or Ronda Rousey on your debt.
- Track your spending. This is my favorite and it will be yours, too. Knowing where your money goes will give you the knowledge necessary to make changes. Write down every cent you spend for a month, use a spreadsheet, or, even better, use my free budget tool (the only downside with free use is I don’t offer any advice to cut expenses faster). I guarantee that you’re spending way more than you think, and wasting dollars on items that don’t matter in the short and long run. And, if you have a coffee habit, know that your “it’s just a couple bucks” per day is actually enough to put a child through college.
- Invest on autopilot. If you aren’t making regular contributions to a retirement or investment account now is the time to do it. Take 10 minutes to fill out the paperwork for your 401k or deferred comp program at work. If you feel uncomfortable going through the process alone, then just call me and I’ll gladly sit on the phone to answer any question that may arise as you fill it out. Or, if you haven’t done this already, setup an automatic contribution from your bank account to all investment accounts you currently have. Don’t have any investment accounts? Then visit our Contact Us page.
So what are you waiting for? Start knocking out your goals!!!
