5 Tips for Reaching Your Financial Goals in the New Year
You may already be retired or you’re just starting to plan for it; either way, this is the time for making New Year’s resolutions toward your financial goals.
Make 2018 “the year of making the right choices.” Take these five easy steps to reach your retirement goal sooner.
- Assess Where You Are
Setting financial goals is crucial, but before you can set any goals, you need to know where you currently are. Analyze your credit card reports and check stubs from the past year. Identify where you didn’t get your money’s worth. Look through your savings, debts, and investments. Assessing your financial status may feel stressful, but gaining this knowledge will allow you to set realistic goals for the year.
- Set a Budget
One of the best things you can do for your finances is set a budget. The budget should be realistic and achievable. Make sure that your housing, food, and utility costs are around what you usually pay. In reality, setting up your budget really should not take up much time. Even if you do not end up sticking to it each month, learning how much you make, what you spend and how the two compare can help you start making better financial decisions. A budget is your spending plan, but it can also help you identify areas where you need to focus, and just creating one can help you bring an awareness to your finances that you did not have before.
- Slim Down Your Debt
Debt is a significant burden and can prevent you from achieving your financial dreams. Try to pay off as much of your debts as possible now. Reduce car loans, student debt and credit card bills a little at a time. The best strategy is to pay off the highest-interest debt first. If you commit to paying off debts now, you’ll be able to keep the money that you invest in the future.
- Spend Less Money
There are many ways to spend less money. Start with looking over your spending habits and see what you might trim. Identify where you didn’t get your money’s worth. For example:
- Did you really read those magazines?
- How many times did you actually watch HBO?
- Did having dinner out every Friday night really make you happy?
- Do you need that landline phone?
If the answer is “yes,” keep spending. But if it’s “no,” get rid of these unnecessary expenses that can add up quickly.
- Meet with Your Financial Professional
Retirement is coming, and you should be preparing for it. You need to discover exactly how much you need to retire. Planning for retirement is always an excellent financial goal, and the new year is the best time for you and your financial planner to focus on it.
Once you meet with your financial professional, you should have a better idea of what type of goals you need to set and strategies to help you start investing. It can be helpful to meet with your financial planner or advisor once a year to check on your portfolio and to see if you need to change your financial plan as your life goals change and evolve.
The new year brings new possibilities for everyone. What do you want to achieve in 2018? Consider your financial goals and start taking the steps to achieve them now.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investments or products may be appropriate for you, consult with your financial professional.
Adult Financial Education Services (AFES)
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