We’re well into the first quarter of the year already. How are your financial resolutions looking?
If you’re still trying to find your groove this 2020, then check out these tips to find yourself in a better financial shape by the end — or earlier even — of the year. Because this 2020, we’re all about saving more, getting out of debt, and becoming financially healthier.
Look Back at 2019
You have to be honest with yourself, how did you do — financially — in 2019? As you go through your 2020 financial resolutions, it’s important to look back at your 2019 financial resolutions. Were you able to stick to them through and through? What are your wins? What were the challenges?
Take note of all the things that took place in relations to these resolutions and take the time to assess how they can help you with your 2020 financial goals.
Make a 2020 Budget
By now, you should already have created a budget for the year. If not, it’s about time to start making one and actually sticking to it. This is, by far, the best and most basic thing you can do to help yourself become financially healthy this year.
The best way to start is to track your spending (can be daily or monthly, depends on your personal preference) so you can have a clear idea of where your income is going. When you do this, you can identify expenses you can eliminate or minimize in order to save money.
Declare 2020 as Debt-Free Year
It’s the perfect year to pay off all your debt. If you want to achieve real financial freedom this 2020, it’s important to choose between these two strategies to reduce or eliminate debt: The Highest Rate Method and The Snowball Method.
If you want the quick but impactful way, you go with the first strategy. This allows you to pay off the highest interest rate as soon as possible to eliminate debt that’s costing you the most money. However if you want the slow but safe route, go for the second strategy. Pay off the smallest debt first then move on to the next — just like a snowball.
Check on your Investments
Make the most of the start of the year to review and rebalance your investments. Keep in mind the different personal and economic changes that have happened — and are currently happening around you.
If you haven’t started yet, then this is your wake up call! Remember, investing is one of the fastest ways you can build wealth. Keep yourself educated and in the know by speaking to a financial adviser, or browse through our investment articles.
Build an Emergency Fund
It’s not as if we’re hoping for the worst, really. But having funds that can keep your covered during an emergency is always a good thing. It can range from an unforeseen medical expense, career changes, or even actual accidents. If you have cash on hand for these emergencies, you can ultimately avoid possible debt or bankruptcy.
What we suggest is keeping your emergency fund in a high yield cash management account with a higher interest rate than your typical savings account.
We still have 3 more quarters left for 2020. Make use of the remaining months to get ahead of your financial goals to ensure you get to save while having the time of your life this year.