SafeAmerica Credit Union

achieving a financial goal

• By Kevin Alvarez

Make Money Resolutions That Stick

Maybe you only have one resolution this year. Maybe you have a laundry list of resolutions and a goal of being so self-actualized your friends and family will hardly recognize you! Maybe your resolution is to not have a resolution.

Set A Goal (and Write It Down)

Goal setting gives you direction. You can decide on your destination and make a plan to get there. This might seem small, but it’s not. Not only is goal setting found to be linked to higher achievement and self-confidence, but writing down your goal can also make you 42% more likely to succeed.

Get Clear

Getting clear on your priorities and deciding on a specific goal are two keys to success. When it comes to your money and your financial situation, set aside some time to reflect on what you really want to accomplish – and be specific.

Ask yourself three “W” questions:

  • What do you want to accomplish?
  • When will you achieve it?
  • Why does it matter to you?

Visualizing a dollar amount can lead to success, whether it is a specific figure to save, pay off or earn in the year ahead. Keep that figure alive by writing it down or tracking it in an app. A real dollar amount makes for a real goal. Give yourself a deadline while you’re at it, to motivate you even further.

Be Positive and Realistic

Goals can challenge you and help you grow into a new future. Choosing a goal that is attainable is another important part of success. Let’s say you’ve chosen a clear goal – with a positive outcome – such as: “In five years, I will be debt free. I will pay off my entire debt of $12,000 so that I can focus on enjoying my family instead of worrying about money.” Be sure it’s a realistic goal given your specific situation. Given your income, debts and expenses, is it realistic to spend $200 on your goal each month? Is it possible to pay it off even faster by spending $250 a month? Or does your budget allow for $100? Staying positive and realistic shows you how much you can devote to achieving your money resolution.

Money Resolutions That Stick

Hit Those Milestones

Making your goal measurable will help it stick. Keeping track of your progress can help you stay focused and motivated. Tracking progress on an app or spreadsheet, or a simple notebook, helps you see your future getting closer and closer. Break your goal into smaller milestones. This makes it easier to see your progress and it’s less intimidating. For example, a mini-resolution might be to pay off one consumer credit card. Making smaller changes over time is often easier than trying to make a massive change all at once. Celebrate your success along the way. Celebrating wins actually “trains your brain” by reinforcing your new habits, which in turn makes it easier to stay on track if you hit a bump in the road at some point.

Make (and Work) The Plan

Money resolutions often go by the wayside if they serve as a goal without a plan. A plan outlines how you will accomplish your goal. Keep it simple. The plan might dearly define how much you will spend toward your goal, how often you’ll make deposits on it, and the method you’ll use to transfer money toward your goal. For instance, automating monthly payments or savings goals is proven to help people stick with money resolutions.

Choose one habit at a time to change. For example, if you need to reduce your credit card spending, focus on making that change as your first milestone. Then move on to setting money aside for payoff.

This article is shared by our partners at GreenPath Financial Wellness, a trusted national non-profit.

GreenPath Financial Wellness

• By Kevin Alvarez

Managing Debt as Interest Rates Rise

Debt can be a challenge to manage, even in the best of times. Now, with the economy in the news nearly every day, how do you effectively manage your debt as the cost of borrowing for things like homes, cars,
and credit cards rises? People are successful when they set a realistic budget for spending. Focusing on non-traditional gifts, the joy of experiences and the resulting memories, can be just as rewarding without damaging your finances, especially as prices on essentials are rising.

Here are five general questions to ask in order to minimize the hit to your wallet in the face of rising interest rates.

What's Your Current Credit Score And History?

Knowing this information helps you understand how rising interest rates will apply to you. Some research shows that only 33 percent of Americans checked their credit score in the past year. Regularly monitoring your credit can alert you to errors, protect you from fraud, and provide you valuable information to strengthen your credit score–which can potentially minimize the rising cost of borrowing.

What Is Your Debt Portfolio?

Another helpful course of action is to make a list of your current debt such as credit cards, car loans, student loans and other debt. Although it’s a simple step, this can make a big difference in visualizing the big picture of your financial situation. Part of seeing the impact of rising interest rates is understanding exactly where you stand.

What Are Your Current Interest Rates?

An effective next step is to regularly review your balances, terms, and interest rates on a monthly basis. By staying on top of this vital information, you can make adjustments and informed decisions about reducing any existing balances more aggressively. As a debt paydown strategy, it often makes sense to start with the highest interest credit cards or loans.

What Is A Realistic Payment Plan?

As you are able, consider paying credit card balances in full by the due date each month. You can avoid interest charges on what you purchase, which means rising interest rates may not have much of an effect on your household finances.

What Is Your Overall Financial Plan?

To stay financially healthy and minimize the impact of rising interest rates, it is key to earn more than you spend, so that you have enough money to build savings for the future. Keeping an eye on your spending is an important step in the effort to create a budget without the cost of high-interest debt. Once you develop a household budget and track income and spending, it becomes clear where the money is going and where you need to adjust your spending to achieve your financial goals. By setting financial goals, preparing a financial plan, sticking to a budget, and setting up an emergency fund for the unexpected, you ensure that your financial well-being does not suffer as interest rates rise.

This information brought to you by GreenPath Financial Wellness.

GreenPath Financial Wellness