Now that your Christmas list is in the rearview mirror, it’s time to look ahead and turn your attention to that list of New Year’s resolutions for 2022. If you’re like many people, you might resolve to improve your overall health through diet and exercise. While you’re at it, why not resolve to improve your financial health, too?
Taking control of your finances means you’ll have more control of your life, whether it’s accomplishing goals and dreams or weathering unexpected storms.
Here are a few financial resolutions to get your new year off to the right start:
Resolve to track your spending
If you’re on a diet, you might keep a food log to track your calorie intake and learn where you can make changes in your eating habits. The same is true for expenses. Making even small changes in your spending habits can free up money to bolster an emergency fund, save for college or pay down debt. It may feel cumbersome to log every dime you spend, but it’s a great way to get a detailed picture of your financial habits – and it may surprise you. You may be wasting money every month on things you don’t use, like gym memberships or subscriptions. Or you may discover those daily lattes at your favorite coffee shop are not only costing you a lot of extra calories but also a decent chunk of change over the course of a month or year. Tracking expenses can be as simple as keeping receipts in a binder and logging expenditures with pencil and paper. You can also use a spreadsheet or an app on your phone. If you use credit or debit cards for most of your spending, you can access that information online.
Resolve to use credit cards wisely
Credit cards make it easy to track expenses, but they can also make it easy to spend beyond your means. When you continue to carry a balance on your card, especially with high interest rates, debt can snowball quickly until you end up owing hundreds or thousands of dollars more than you initially spent. Any money you pay in interest is money you won’t have for another financial need or goal. Credit card debt can also damage your credit score, which means you may have to pay a higher interest rate when you take out other kinds of loans. If you are going to use a credit card, do not charge more than you will be able to pay when the bill comes due. Pay your bill on time and in full every month to avoid late fees and interest charges.
Resolve to assess your investments
Investments can take many forms, from stocks and bonds to employer-sponsored retirement plans. They’re a great way to make your money grow while planning for future needs. Determining how to invest your money depends on your goals, timeline and risk tolerance. If you’re younger, it may make sense to take more risk for a higher rate of return. As you get closer to needing those investment funds, a more conservative approach may be in order. The new year is a good time to meet with a PeoplesWealth Advisor to review your portfolio, your goals and the current market to ensure that your asset allocations are on target to meet your needs.
Resolve to have a plan
Managing your money is a lot easier when you’re working toward clear financial goals. The PeoplesBank Vision Board is a great way to put those goals in focus. The interactive experience allows you to create your personal vision for the future. It might include anything from getting out of debt and buying a home to starting a business or taking a dream vacation. PeoplesBank financial mentors will help you define your dreams and create a financial plan to achieve them. The vision board experience is available at all PeoplesBank locations, and you don’t have to be a client to use it. Learn more at www.peoplesbanknet.com/vbx.
