Money 2017: How to Start the Year Off Right

If you haven’t already made yourself a new year’s resolution – don’t worry, I’ve got one for you. Make 2017 a year of better financial footing. All you have to do is kick the year off on the right foot and make some adjustments for better finances. There are a ton of things you can do to get yourself on the right track, but we will focus on a few of the bigger ones in order to make the largest impact.

Reevaluate Goals

The first step in tackling your financial new year’s resolution is reevaluating, resetting, and creating goals. Goals are the finish line of your resolution, but you can’t possibly get where you want to be without knowing the end. Goals also give you something to work towards. They will keep you on track and motivated to reach a better financial foundation. Set both large and small goals. Be care to not shoot for unattainable things though, because they aren’t going to do you any good.

Automate Saving and Bill Pay

The absolute best thing you can do for yourself is to automate as many payments as possible. One of those payments should be to your savings account. Most living expenses and monthly bills offer an autopay option, so take advantage of it. This will help you pay bills on time and never leave you paying a late fee ever again. Additionally, schedule payments or transfers from your checking to savings. It’s a good way to consistently build up your saving with little effort on your end.

Cash Budgets

Another thing you can give a shot is a cash budget. Many people say it’s much easier to lose track of spending when you use plastic. It makes a lot of sense. Paying for things in cash helps you visualize exactly what you have left to spend. It may also deter you from making certain purchases. You can start small and set a cash budget for things like eating out. If you keep cash on you that only can be used for food that week, you’ll be surprised at how much you save by sticking to it!

Bill Due Dates

Another way to balance your finances is to change bill due dates. Depending on your pay periods, it may be easiest to pay half your bills at the beginning of the month and the rest in middle. Right now you may be tight for the first half of the month because all your bills are stacked at one time. Requesting a change in due dates will help you budget better and leave you with more money each paycheck.

Why Most Budget Attempts Fail

Budgets can do wonders for you and your finances, if they actually work. Many people try to budget, but ultimately give up on it after a few month. There are many different factors that go into the effectiveness of a budget, but a few things stand out as the most common. Here are a few of the most common issues people have with budgets and some tricks for fixing it!

Unrealistic Expectations

A personal budget always fails if you went into it with unrealistic expectations. A budget, no matter how strict, won’t help you bank a million bucks in a few months (unless you have that kind of income). In order to have a budget that works for you, try resetting your expectations. If you are not reaching the savings expectations you wanted, it may simply be because your income and expenses do not allow for it.

No Adjustments Made

Budgets are meant to be flexible. Something that looked good on paper three months ago may not work for you now. Revisit your budget every few months to see if its still working for you. If it’s not, make adjustments! Remember, a budget is supposed to work for you, not against you. As long as you’re able to hit the realistic goals you set, then it’s working for you just fine.

Not Attached to Personal Goals

If you have not attached your budget to personal goals, you’ll be in trouble. It’s hard to stay motivated and accountable to a budget if there is nothing in it for you. If you have a budget in order to save more money, what are you saving for? Tie it to something personal like a vacation, an emergency fund, or funds to pay down debt. The closer your budget is tied to things that you want to achieve, the more likely you are to stick to a budget and make those things happen.

Irregular Spending Not Accounted For

Your budget may seem broken if you have not accounted for irregular spending. Do you only pay car insurance every quarter? Are there months where birthdays/anniversaries/outings happen more than any other time? It’s easy to forget about these instances, but they do factor into your spending. Try reevaluating your budget and factor in all kinds of irregular spending. Then give the budget another shot. It’s better to overestimate spending. The extra money you’ll end up with at the end of the month can be a nice addition to a savings account or to treat yourself for sticking with it.