The new year invites the opportunity to commit to new resolutions. While we commonly resolve to get fit, eat healthier, and manage stress better, it can also be the perfect time to consider and analyze all areas of our financial well-being.
January is National Financial Wellness Month and in today's economy, it is more important than ever to pay close attention to our financial health. In this new year, many of us may also resolve to cut our spending, increase our savings, or be more disciplined with our trading plan. It is a great time to give our financial plan a fresh look and focus on making changes and improvements to our financial well-being.
We've gathered 5 very simple and important tips to help you get started on the path to achieving your financial goals.
1) Know Your Expenses
It is imperative to know your fixed expenses and how your are spending your money. It is the first step in determining where you could "trim fat" if the circumstances required it. With dozens of bills, it’s easy to forget exactly what you’re paying for. Having a grasp on these bills and their importance or frivolousness will help you determine a baseline for daily living expenses.
2) Contribute To Your Retirement
Whether it is an employer-based 401(k), Simple IRA, ROTH, or other account type, saving for retirement is extremely important. 80% of Americans aged 30-54 believe they will not have enough money put away for retirement (1). The thought that you may not have substantial funds to get you through those last few decades of your life should be encouragement enough to contribute to your retirement savings and stick to your plan.
3) Create A Budget & Stick With It
Many times, the most simple tip is the most difficult to implement. Make sure the money you have coming in is greater than the money going out. More than that, plan your budget to include retirement savings, personal savings, emergency savings and savings for that next big purchase.
4) Consult A Tax & Financial Adviser
Tax rules change so very quickly and it can be difficult to keep up with the many adjustments and revisions. It may be helpful to consult a tax or financial advisor.
5) Keep An Eye On Your Credit
Your credit is only as good as its score and its accuracy. Make sure you pay your bills on time and check annually for any inaccuracies or fraud that may be lowering your score. This score is a number that may dramatically influence your lending interest or even future employment.
There are so many things to consider in regards to your financial future. Empowering yourself and taking an involved approach is the best away to protect and improve your financial wellness.
(1) Bankrate, 1/1/14