Five Tricks to Keeping your Financial New Year’s Resolutions
If you’re making New Year’s Resolutions, chances are good that you’ll have one on your list related to your finances. After holiday spending is the perfect time to start re-evaluating your economic situation. If you’re looking to save some extra money for a summer vacation or down payment on a home, below are five tricks that can help you achieve those financial New Year’s resolutions.
Write it down.
Get a nice journal that you can use to record your financial resolutions as well as the steps you need to take in order to achieve them. Of course it’s nice to have a perfectly organized spreadsheet right up front, but research has shown that writing information down is better than typing for memory retention and stress. That’s the first step – Just start. Don’t underestimate the power of just writing it down. A year from now, you may wish you had started even earlier.
Track all of your expenses.
And by this, we mean all of your expenses. A lot of times what ends up happening is that consumers only track major expenses like car payments, rent, or big purchases. Small purchase like a daily cup of coffee can easily add up to several hundred dollars a month. Once you have figured out where all of your money is going, you can start cutting unnecessary expenses. There are tons of free apps you can download to track your expenses, or maybe consider banking online with no fees if you’re really looking for a fresh start for your financial situation.
Seek out cheaper alternatives.
One of the fastest ways to cut back on expenses is to completely cut out those smaller expenses that can add up. This can mean that second glass of wine at dinner, or a movie you can just see at home. If this doesn’t feel like a viable option, you can do the next best thing, and that is to find cheaper alternatives. This can be done by either purchasing a smaller size/quantity of the product, or by purchasing the lesser known brand.
If abandoning your favorite cup of joe is out of the question, you can opt to buy it less frequently (every other day) or a smaller size. While this method won’t save you loads of money, it’s a step in the right direction and will teach you to be conscious of your spending habits.
Set realistic goals and stick with them.
Let’s face it, new year’s resolutions are made to be broken. Money management is one of the most broken new year’s resolutions. For some reason, people are failing to complete what they set out to do. Do not fall prey to this trap. Be practical about your goals, and don’t set goals that you can’t accomplish.
Make sure to reward yourself.
Once you’ve finished a resolution, give yourself a reward, like a new blouse or a visit to a local museum. If you’re tracking your finances with you an app, set up a reward category with an amount you think is enough to treat yourself with but not so much that it’ll cut into your savings. Setting up a reward system like this will keep you motivated throughout the whole year, and that summer vacation will never feel better.
With these five tips, you’re sure to change your spending habits and save a few more of those Benjamin Franklins.