How do you go with making and keeping new years resolutions?
It is very common for the resolutions made in January to already be forgotten by the end of February.
Does this sound familiar?
This makes a lot of people disheartened about even setting new years resolutions in the first place.
What you may find works better, is setting ‘New financial year’ resolutions.
By mid-way through the year, you are a little more clearheaded and not so distracted by the craziness of the festive season. You also realise that you are now half way through the year already and if you don’t get serious about doing something now you will be back at the end of the year again and in the same position you were, or even worse.
If you’re after some guidance about what kind of financial resolutions to make, here are some ideas:
- Get honest with your money
If you you’re like many others we speak to, you may be in denial about your finances. You may have credit card debts that you chose to ignore. You may have a shoe addiction that you choose to not pay attention to the affect this has on your bank balance. Or you may not be honest with your partner on where you spend your money.
You need to stop living in denial, and get honest with your money.
So, start by writing down everything you have and everything you owe. If you have a partner, do it with them. Include all financial assets and all debts, credit cards, store cards and loans. This will allow you to have an honest look at where you are now.
- Track where your money is going
You can’t track what you don’t measure. You need to be keeping track of where you spend your money each week.
An awesome way to do this is by using a cloud based software program like xero which will link to your bank account transactions. You then categorise those transactions into difference expense options so you can see where your money is going. It also allows you to set a budget, set some goals to achieve and learn to be more conscious about your money.
- Set some savings goals
If you haven’t set some financial goals – start today! Without knowing what you want to achieve, it’s harder to stick to a budget or savings plan. Put some short and long term goals in place, then work out how much you need to save to reach those goals. Work it out on a weekly or fortnightly basis and start an automatic savings plan.
- Are you planning on retiring soon?
You need to have a plan in place. You need to work out when you want to retire, how much income you would like to receive in retirement, how much you need to provide that income and what your current situation is. Then work out the gap between where you are and where you want to be. They put a plan in place to reduce that gap. You could consider reducing your spending, increase contributions to super or adjusting your time frame to retirement. It’s so important that you start to plan early. A road can take you anywhere, but a plan on how to get to where you want to be will make the trip much more efficient.
- Are you and your family protected?
Have you recently considered what would happen financially if you (or your partner if you have one), was unable to work due to sickness, injury or death? How would you pay the bills, loan payments and normal living costs? You may even find you have more expenses arising due to medical costs. Having the right amount of personal insurances can allow you to concentrate on recovering and returning to work, rather than financial stresses.
A new financial year is a great time to get more financially organised. Now is the time to make the most of this next financial year and get financially fit!
If you need any assistance setting goals, creating a budget that works for you, and removing financial stress, our ‘Freedom 2 Achieve’ program may be the multi-vitamin you require. See more information on our website here.
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