Most people make it a New Year’s Resolution to become more financially stable but not many actually manage to keep this promise. Shockingly the new decade has been no different; as we approach the end of quarter for 2020 many have long abandoned their lofty aspirations of financial independence.
The best way to do better in the future is to look at what you have done in the past. We recommend setting yourself some financial objectives for this year by first examining which objectives you did or didn’t manage to achieve in 2017. Be honest with yourself in which goals may have actually been too unrealistic for you to reach, or how hard you tried to reach others, and begin this year’s aims by following the SMART model.
SPECIFIC – If you set clear objectives you will know exactly what you are aiming for and how you will get there.
MEASURABLE – This will help you to monitor your progress in achieving your goal and how closely you actually achieved it.
ACHIEVABLE – By setting a realistic aim you can feel confident that you will achieve it instead of feeling overwhelmed by more ambitious goals you set last year.
RELEVANT – It may be easy to come up with many plans when you think about it but focus on the most important ones that will actually make a financial impact for you.
TIME-BOUND – Don’t keep pushing the deadline further and further away. By setting deadlines you will feel encouraged to be productive and want to push yourself to complete your goal on time.
After learning the SMART model and setting your goals out for the rest of the year ahead, try following some of these tips which will help you to save more, spend less and tick off all the financial plans you’ve made.
- Learn about your financial self
It is very easy to become disorganised with your finances and to spend money freely without considering the repercussions or what financial state you are actually in, but you should sit down and examine some key factors that might affect your finances.
Some examples are:
- How much money did you make last year and will that increase this year?
- How much did you spend last year, did you make any big spur of the moment purchases or did they follow a general trend?
- Do you have a monthly budget or any savings?
- Do you have any investments or assets?
- What does your debt situation look like? Any long term debts such as student loans? Or if you are going through tertiary education and are unsure about the positives and negatives of student loans specifically you can find out more here.
- Consolidate your debts
If you have many outstanding debts all at different interest rates it can be very overwhelming trying to pay them all when payday rolls around, so debt consolidation may be a solution for you.
This means gathering all of your debt into one place and having only one interest rate and monthly payment to make. You can consolidate your debts through a credit card or loan, but if you plan to use this method make sure you choose a loan which is upfront and clear about the costs with no hidden fees so it’s easy to manage.
- Have no-spending weekends
Not every weekend has to be filled with expensive activities, and trying to go without spending can open your eyes to a huge variety of activities that you may have never considered doing such as going to a museum, learning a new skill or even volunteering to help others. You can find out 40 Massive Money Saving tips here that should help you on your way to thriftiness.
- Talk to your family
So many people leave their family in the dark when it comes to their financial situation which can sometimes feel like a huge weight on your shoulders. Just talking about a problem you may be having can make you feel much better and you may be offered helpful advice.
If you have children you should also talk to them and help to educate them on savings, retirement or if they will receive an inheritance from you. If you felt confused about finances growing up, one of the best ways to prevent the next generation from feeling the same is by this communication.
- Learn about investing
Don’t leave investing until the last minute and don’t be uneducated about the topic. Investing can help you reach targets like securing a down payment for a home or saving for your retirement. Work out how much this may cost you and open an investment account, then be strict with yourself about not touching the money.
You can add to it whenever you are able to and know that it is a wise decision that will also contribute to being financially independent.