New Years Resolution Goals. Have you written one yet? Or do you think New Year’s goals are just unproductive publicity stunt?
People who make money resolutions each year feel more financially confident and secure by year-end than those who skipped a resolution. Committing to a big goal is one thing; planning a smart strategy to see it through is another.
Here are some of our New Year’s resolution ideas:
RESOLUTION 1: SAVE MORE FOR RETIREMENT
You should plan to put aside about 15% of your income for your retirement plan. This will also raise your savings rate automatically each year. Most people making New Year financial resolutions say their priorities are spending less, saving for retirement, and cutting debt.
Make a budget and stick to it. One rule of thumb: 50% to essential expenses, 15% to retirement savings and 5% to short term savings.
RESOLUTION 2: SPEND LESS
Need help sticking to a budget? One proven method that can help get your spending under control is Pay in cash. This is because when you spend can unlike credit cards or digital money it hurts more and there is always so much you can carry in cash.
People are always willing to pay nearly 65% more for entertainment when using a credit card or digital money rather than cash.
To curb merry spending, set aside a weekly amount in an envelope for optional items like eating out. When the envelope runs out, you are done.
Don’t like carrying cash? Psych yourself out. People are willing to incur 28% more credit card debt when they remembered two times they indulged in a spendthrift behavior, compared with when they remembered times they abstained.
So if you find yourself tempted by a binge, think about a few times you successfully avoided budget killers
RESOLUTION 3: SAVE FOR AN EMERGENCY
One of your New Years resolutions should be to put aside more money for emergencies? To make this easier, automate it. Just as you should do with your retirement savings
You don’t have to increase your savings significantly to make a big difference long term. Just upping your contributions by 1% of your salary can go a long way.
Have HR or your bank direct a portion each pay check say, 5% into a savings account. That way, you never see it. Cover up your savings with bonuses like tax refunds, and at least part of any extra earnings from side gigs. If you get a raise or finish paying off a loan, add that money too.
Aim to build up three to six months’ income. Need extra help? Tell a friend. Remember those who shared their New Years resolution goals were 33% more successful than those who didn’t.
RESOLUTION 4: PAY OFF DEBT
Student loans, credit card debt, a car loan, the best strategy for paying them all off is by being strategic. Pick one debt to focus on, and pay just the minimum on everything else.
Credit card debt should be your top priority. You have two choices here. You’ll save the most in the long run if you focus first on the card with the highest interest rate.
But if you feel overwhelmed, wrestle the card with the lowest balance so you’ll have a success under your belt. Remember people are more likely to pay off their entire credit card debt if they paid the smallest balances first. Go with what encourages you.
RESOLUTION 5: BALANCE YOUR TIME
Find ways to grab back some time. If you can work from home one day a week, you’ll still have lots of time to see and interact with your colleagues, and skipping the commute gives you back that time.
Delegating a few work tasks to junior staffers can also help. It’s a classic win win: Your employees get a chance to gain experience and prove their determination while you get some precious free time back. Balancing your time is an important New Years resolution goal that can also affect your health positively.