- Life & Money
- Everyday Money
- Managing Finances
- Jacqueline DeMarco
- Dec 16, 2022
8 Financial Quick Wins to Start the New Year Right
The end of the year always comes with a long list of expenses to tackle — buying presents, decking the halls, traveling and hosting parties can all come with steep price tags. This year, rising costs due to inflation may be taking an even bigger than usual chunk out of your holiday budget. Which is why when all the merriness dies down, the new year is a great time to get back into the swing of things by checking some quick financial wins off your to-do list.
The time to get your finances in order is now. Make these simple moves to start 2023 off on the right financial foot.
Track last year's spending
Before you start thinking about what you want to accomplish over the next 12 months, take an honest look at how you spent your money last year. You know where your income comes from, but where exactly is it going? Break down your spending into categories and see how much you spend on both necessary and unnecessary expenses. You may find some places to make a change — by spending less on eating out, for example, or allocating more to your savings goals.
Create a new budget
Thanks to rising inflation, a budget that worked well for you in the past may no longer be serving you. After reviewing last year’s spending — did you spend significantly more on gas and groceries? — you can create a better-informed budget. You now know exactly what you spent last year and where you want to make improvements, so set a savings and spending plan that will move you toward your goals.
Mark financial deadlines
Make sure you never miss a rent payment again by marking important financial deadlines in your calendar. Set alerts so you’re reminded a day or week beforehand. This will ensure that you won’t have to scramble to get a timeslot with your accountant or realize that a free trial ended months ago.
Tackle your highest interest rate debt
The Fed’s efforts to combat inflation have meant higher interest rates — which can make your debt even more expensive if you have a variable interest rate on any loans or credit products. If tackling debt is high on your list of resolutions, the total of everything you have to pay off can be overwhelming. A good way to start is by focusing on the debt with the highest interest rate (while continuing to pay the minimums on your other balances). This debt will cost you more in the long run (in interest), so paying it off more quickly will save you money.
Increase your retirement contributions
If you set your retirement contributions when you first started working and then promptly forgot about it, it’s time to revisit your strategy. You’re likely earning more now, so adjust your contributions accordingly. Even if it’s just one percentage point, it can make a big difference in your retirement savings (don’t forget to factor inflation into your retirement planning). And if you’re looking for other ways to boost your savings, these tips can help.
Cancel a recurring monthly expense
Are you subscribed to six different streaming services but only use two regularly? When was the last time you attended a meeting with that professional society you joined? Fitness resolutions are also popular this time of year, but have you ever taken enough yoga classes to justify your unlimited membership? You can probably eliminate these extras from your life without even noticing it. And if you do really miss a service or subscription, you can it, you can always sign up for it again — just make sure you account for it in your new budget.
Plan a spending freeze
Challenge yourself to a spending freeze in the first quarter of the year to reset your budget. Abstaining from all unnecessary purchases (the essentials like rent and groceries are still allowed) for a week, month, or whatever time period feels right to you can help you evaluate your spending, make you more mindful and improve your overall wellness.
Learn more about your money
Do you want to do more with your money but aren’t sure where to start? Are you still a little unclear about how retirement accounts work? Set aside time each week to learn more about the financial topics that are important to you so you can better manage your money. Learning more about financial planning will make you feel more confident and ready to tackle any hurdles that come your way.
Take the next step
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