The New Year represents the turning of a new leaf, and a time to break old habits and set goals for a wonderful year. Like many millennials, you are probably exhausted from a whirlwind holiday season and from your big New Year’s celebration. Well, the good news is that your New Year’s Resolutions don’t have to be ridiculous (like learning three new languages or losing 10 pounds by February). If improving your financial prosperity in 2014 in one of your goals, here are some simple, concrete ideas that can help lead you on your financial path.
Evaluate your expenses. If you haven’t already looked at where your money goes on a monthly basis, this can be extremely eye opening. Some things like car payments, rent or student loans are fixed. But how much are you really spending on Starbucks, eating out and new clothes? Make a list of where your money goes and classify them in categories. From there, you can see your finances from the top down instead of feeling like you’re in the thick of it all. Use tools like Quicken or an Excel spreadsheet to help in the daily management your finances.
Trim the fat. And we’re not talking about body fat! If your wallet is bulging with credit card debt that you incurred during the holidays, it’s time to look at what the damage is and start paying it off. If you have multiple credit cards, pay off the one with the highest interest rate first and then apply its monthly payment to the balance with the next highest interest rate. 360FinancialLiteracy.org has a great tool to help you pay off your debt, and your local Delta Community Credit Union branch is always here to help.
Set a monthly budget and stick to it. Sometimes simply being aware of your spending habits and making conscious purchasing decisions will help put you on the right path. Think of things you can cut out from time to time (like a $5 coffee) or permanently (who needs cable when there is Netflix, Hulu and the Internet?) and prioritize your finances. With numerous apps and tools to help you, there’s no excuse not to stick to your budget in 2014!
Check on your 401(k) or start contributing to one. Talk to your human resources department and have them put you in touch with their financial advisor. Most companies have someone to help you with your 401(k) and educate you on the best path(s) for financial success. If the resources are there, use them. Even if you have debt and can’t imagine retirement when it’s so far in the future, a 401(k) is the single most important thing you can do to contribute toward your future financial stability. Even the smallest contribution can amount to something substantial over time.
Now that your financial goals are in check, what other personal goals have you set for yourself this year?