Empower Blog

December 28, 2021

Financial New Year's Resolutions

Money-Saving Tips, Holidays
Work out, quit smoking, eat better, travel more – these, along with “manage finances better,” are some of the most popular New Year’s resolutions. Coming up with your resolutions is the easy part but sticking to them is always a challenge. While some people might think New Year’s resolutions are pointless, there really are some that we would all be better off keeping – especially the ones regarding checking and savings accounts. Check out my recommendations for financial resolutions you can, and should, keep this year. These are sure to be a whole lot easier to follow than a strict new workout and diet regimen.

Rainy Day

Whenever someone asks me for financial advice, I usually reply with a question: Do you have an emergency fund? Far too many people don’t, and they typically don’t have a good answer to my second question, either: Why not?

If you don’t have one, begin the new year by building a rainy day or emergency savings fund. Even if you start out with only saving $5 from each paycheck, it’s better to have something than nothing. I typically advise initially having $1,000 in your emergency fund – and trying to keep at least $1,000 in that account at all times. Ideally, you want to work towards having six months of living expenses in some type of liquid account. This will help if you encounter anything from car trouble to a medical emergency.

Face Your Debt

Once you’ve established an emergency fund, it’s time to take note of your debts. Whether it’s credit card debt, student loans, or a mortgage – your debt won’t get any smaller by ignoring it. Look for ways to pay it off faster. Try cutting cable and streaming services or restricting your nights out on the town. Small changes to your lifestyle, and the money you save by making these tweaks, can make a huge difference in the amount of interest you ultimately pay over the life of your loans. If you can challenge yourself to shake up your routine now and cut back where you can, you’ll be thanking yourself in a year’s time.

Make a New Friend

Start the year by meeting with a financial planner. A yearly meeting to make sure you’re on track with your finances is a must. If you have never met with a financial planner, it is never too late to start! Look for someone who has experience with investments as well, since this will help you look toward long-term savings and hopefully motivate you to start planning for your future. For as little as a $50 monthly contribution, you can start investing for your retirement. That’s a resolution you’ll be very glad you kept!
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About the Author
Professional Picture of Kat Hnatyshyn
Kat Hnatyshyn

Branch Manager

Kat’s Money Corner is posted in the Kansas City Star every week. When not blogging or caring for her little ones, Kat is a manager with CommunityAmerica Credit Union.