When you wake up on January 1, will you be excited to say goodbye to 2020? Are you looking forward to the promises that next year holds?
If you are among those who are eagerly anticipating the New Year, it’s important to know that there are some simple steps you can take during this final quarter of 2020 that can have a huge impact on your finances for next year.
Rather than waiting for the calendar to change and hoping that changes your situation, here are some steps you can easily take to build a foundation for a better future.
- Live on a monthly budget. It’s easy to make excuses for not keeping a budget. However, a budget is one of the most important foundational steps to financial success. It doesn’t have to be complicated either.
Give each dollar a job as it enters your bank account so that it only leaves your bank account when you need it to do exactly (and only) that job. Become the boss over your income. Having a plan allows you to see what the dollars in the bank need to do and will help you have a clear picture of your true priorities. There are many apps out there that make budgeting accessible and simple such as EveryDollar , Mint, or YNAB.
- Stay out of debt. As you track the money you are depositing and give that money work to do, make it a priority to use only your own money to pay for your lifestyle. If there are things you desire that would require you to use debt, consider reordering your current life situation to fit your income.
The debt of today steals from the joy of tomorrow. Your income, whatever the amount, is able to build a foundation of wealth for you if it isn’t going into the pockets of creditors. Be wise about your priorities and stay away from the pull of clever marketing tactics. Be patient and stick to your plan.
- Save. Once your budget has allowed you to see what your priorities are and has helped you escape from building debt, allow that budget to help you build wealth by saving as much money as possible.
If your money isn’t paying interest to creditors, you will be able to set aside money to cover emergencies as they arise rather than using credit cards. If you begin saving now, you will be in a place to more easily take all the unexpected things (both good and bad) that life will throw at you.
No matter what step you are on in this process, we are here to help you develop a plan you can actually follow through 2021 and beyond.
Have questions about budgets, debt, and saving? Schedule a session today!