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.
1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
Ready to Make Money Resolutions That Stick?
The New Year is your opportunity for success. Our partners at GreenPath Financial Wellness offer free financial counseling and education. Their caring counselors are ready to work with you for options to get out of debt and improve financial wellness.
This article is shared by our partners at GreenPath Financial Wellness, a trusted national non-profit.
Being financially fit can be thought of as performing like an elite athlete on the playing field of your finances. It’s all about money-savvy acrobatics to keep your cash in tip-top shape.
Financial fitness lets you flex those savings muscles! The stronger your savings get, the more you can lift your dreams into reality. Whether it’s a dream vacation or a shiny new gadget, your savings make it happen.
Being financially fit also means you’re in the race to win at personal finance. You’ve got the determination, discipline, and enthusiasm to take home the gold medal in money management.
Your financial fitness lets you effectively manage your financial resources, make informed financial decisions, and maintain a stable and healthy financial state. It involves practices such as budgeting, saving, investing, and managing debt to achieve financial goals and withstand unexpected financial challenges.
Financial Fitness Checklist
Credit card debt, high interest rates, and rising prices are just a few factors that can challenge how you think about your financial fitness.
While the short video lifted up steps to get you thinking proactively about your financial future, there are other considerations.
To guide those looking to achieve financial goals, this five-part checklist is a way to break the steps down for success.
How did you do on the checklist shared in the video above? Are you working through the items sometimes, all of the time, or never?
1. Track Monthly Spending
Staying financially fit begins with ensuring you 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 that builds. 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.
If you take the time to manage financial tasks, you will start to develop financial fitness. This includes making sure that your bills are paid, that you have saved money for emergencies and that your financial strategy for the future is on track.
With this helpful online worksheet, getting a current snapshot of monthly money will help as you create a plan to increase financial fitness.
2. Set Goals
If you are saving for an emergency home purchase or paying off high-interest debt, a simple plan will help you meet your goals. As an example, by managing debt, you ensure that your financial well-being does not suffer.
It is not uncommon for people with credit card debt to only pay the interest on the amount borrowed, instead of planning to eliminate the debt altogether. When considering your overall financial picture, consider a debt management plan.
3. Know Your Credit History
Another tip from the financial fitness checklist is to pull all three of your credit reports each year. It is easier than you might think.
Checking your credit history can reveal any inaccuracies or issues you might want to resolve. If you find inaccuracies or errors in your credit report, you can dispute them with the credit reporting agencies. Addressing these issues promptly can help improve your credit profile and prevent potential obstacles in the future. Each person’s situation is unique when it comes to credit history and score, a key part of financial well-being.
4. Build a Savings Habit
Setting and sticking to a realistic savings plan is another key component of financial fitness. You can automate savings directly from your employer or put into place other tricks to make it a seamless savings process. No matter the amount, setting aside a budget-friendly amount each month for savings builds fitness and financial health.
5. Connect with Trusted Resources
When it comes to financial fitness, you are not alone. The trusted national nonprofit GreenPath offers the expertise of caring, NFCC-certified financial counselors who are trained to understand your unique financial situation and provide personalized solutions. GreenPath’s caring counselors can help you create a comprehensive plan to manage your debts effectively. In addition, nonprofit credit counseling agencies such as GreenPath offer educational resources, online webinars, and tools to help you understand the fundamentals of personal finance. This empowers you to make better financial decisions in the future.
Why Work Towards Financial Fitness?
Imagine your finances as a well-tuned engine powering your life. When that engine runs smoothly, you have the freedom to do the things you love and handle any unexpected bumps in the road with confidence. Here’s why being financially fit matters:
Less Stress, More Peace: When you have control over your money and know that your bills are covered, it’s like a weight lifted off your shoulders. You can sleep better at night and enjoy a more peaceful, stress-free life.
Freedom to Pursue Dreams: Being financially fit gives you the ability to chase your dreams and passions. Whether it’s traveling the world, starting your own business, or buying a home, having the financial means makes those dreams attainable.
Security During Emergencies: Life throws curveballs, and having a financial cushion means you’re ready for them. Whether it’s a medical emergency, unexpected car repair, or a sudden job loss, being financially fit means you can weather these storms without losing your footing.
Retirement Comfort: Financial fitness ensures that you can retire comfortably when the time comes. You won’t have to rely solely on social security or work during your golden years, giving you the freedom to relax and enjoy life.
Building Wealth: It’s not just about getting by; it’s about thriving. Being financially fit allows you to save and invest, which can grow your wealth over time, giving you more options and opportunities.
Reduced Debt Burden: Financial fitness often involves managing and reducing debt. Lower debt means less money going toward interest payments and more money for you to use as you see fit.
Peace of Mind for Loved Ones: If you have a family or dependents, being financially fit means you’re providing security and a better future for them as well.
Final Thoughts About Your Financial Checklist
As with a healthy diet, we maintain our physical fitness in the same way, and if we follow this checklist shared in the materials above, we can return to financial fitness with a little help and a clear strategy.
It is always a good time to understand where you are financially and get help to keep things on track. Caring, certified counselors from the trusted national nonprofit GreenPath Financial Wellness can help you get started on your financial journey and then, keep going.
In the end, financial fitness isn’t about having tons of money; it’s about managing the money you have wisely. It’s a journey, not a destination. So, take small steps, make good financial habits, and watch how it transforms your life for the better.
This information is brought to you by our partners at GreenPath Financial Wellness
As a parent, you may be wondering what type of conversations you may begin to have in order to develop financially healthy kids. Coming out of the unprecedented year we all endured, it may serve as a good opportunity to begin sharing valuable life-lessons about money.
Here are some tips that will show you how to raise financially healthy kids.
Talk About Money
Let’s change the narrative around money. You can introduce the concept of money to your kids at an early age. As your children grow, continue to deepen the conversation and help them understand the concepts of money.
If you're unsure of where to start, you can also ask a trusted friend or family member to have these conversations with your kids. It’s also ok to let your kids know that you don’t have it all figured out. Explain the things you’ve done and what you would or wouldn’t do again and why. Sharing is how we learn!
Involve Your Kids in Major Purchases
Deciding where to go on vacation? Buying a new appliance? Include your kids in the process. They can help with the research. You can show them the factors that go into making the decision. You can help them compare the options before making the purchase. Even better, allow your kids to pay for the major purchase. Imagine how your children will feel knowing they did the research to make the best decision for the entire family.
Teach Your Children Math and Money
Most people don’t learn about budgeting until it’s too late. Imagine what the future will look like for your children, if you teach them the value of savings today. Show them how compounding interest works. When you go to the store, could you give your kids a $10 bill and ask them to purchase part of the grocery list? When could you teach your children about credit? Could you educate them about how credit cards work before they go to college?
Teach Your Children to Record Their Spending and Saving
Remember the main reason for teaching our children about how to track their spending is to allow them to better understand where their money goes. More importantly, this allows our children to successfully handle their money and achieve their goals.
Don’t worry, teaching your kids about money doesn’t have to be a daunting task. If you’re like most people, the hardest thing to do is to start the conversation. We are here to help. Share these posts with them, discuss the articles on GreenPath’s site or simply reach out to us for ideas.
SafeAmerica's Youth Program
Set up your children for financial success! Learn about our Youth Program and implement tips from this blog to jumpstart your children with healthy financial habits.
This free, one hour webinar about Financial Transformation is presented by GreenPath Financial Wellness
Join us for a lively discussion about tips, challenges, and resources needed in order to raise financially healthy kids. Be part of our audience for our live podcast, Real Stories: Journeys of Financial Wellness. Our panel will feature GreenPath clients who are inspiring their children to be financially resilient. We'll also chat with Professor Bernard Dillard. Come along with GreenPath Financial Wellness for an enlightening session on how we might support the next generation in their financial in their financial wellness journeys.
Who should attend
- Parents who would like to learn from others' experiences about kids and money
- Anyone who wishes to mentor a young person about money
- Teens or young adults who wish to jump start family conversations about money
What You'll Learn
- How to communicate with your kids about money
- How to overcome family financial challenges
- About resources to share with your family and community
Date: Wednesday, July 28, 2021
Time: 10:00 am PST - 11:00 am PST
This free, one hour webinar about money concepts is presented by GreenPath Financial Wellness
Do you have a financial wellness goal of becoming a homeowner? With interest rates at a record low, you are not alone. Let us help you navigate this important milestone during a seller's market. The goal is for you to secure a good home, without jeopardizing your financial future.
What You'll Learn
- What is important to most sellers in today's real estate market
- The realistic timeline of how long buyers, lenders, and other real estate professions may impact the home buying process
Who should attend
- Those providing guidance to home buyers (real estate agents, housing counselors, parents, grandparents, etc.)
- Potential home buyers
Date: Wednesday, June 23, 2021
Time: 10:00 am PST - 11:00 am PST
Information brought to you by our partner, GreenPath Financial Wellness
If you are dealing with debt, you aren’t alone. The average American household has an average balance of about $6,600 in credit card debt, and that’s not taking into account home, auto, and student loans. Paying off your debt isn’t always easy, but having a plan can go a long way in achieving your financial goals.
Two of the most popular strategies for paying off debt on your own are the snowball method and the avalanche method. Both methods require making the minimum monthly payments on all but one debt, which you put extra money towards.
The Snowball Method
With the snowball method, you begin by paying off your smallest debt first. This method creates a sense of motivation and accomplishment from being able to pay off smaller bills at a higher frequency.
How it Works
Let’s say you have the following debts:
- Credit Card A: $3,500, 17.99% APR
- Credit Card B: $7,500, 15.00% APR
- Personal Loan: $1,000, 10.05% APR
Using the snowball method, you would pay the minimum monthly payments to the credit card debts, and pay any extra that you can to the personal loan until it is paid off. You would then apply the extra payments to Credit Card A until it is paid in full.
Pros and Cons
With the snowball method, you are able to see progress faster. Quick wins can help you stay motivated to keep going. However, with this approach, it will take you longer to pay off your largest debts—and those are often the ones that carry the highest interest, so you’ll likely end up paying more overall.
The Avalanche Method
The avalanche method takes into account the fact that high-interest debts cost you the most money over time. Using the avalanche method, you pay off your highest interest debts first.
How it Works
Let’s look at the same scenario as above.
- Credit Card A: $3,500, 17.99% APR
- Credit Card B: $7,500, 15.00% APR
- Personal Loan: $1,000, 10.05% APR
With the avalanche method, you’d pay the minimum monthly payment on Credit Card B and the Personal Loan, and pay extra towards Credit Card A, since it has the highest interest rate. Once it was paid off, you’d move on to Credit Card B.
Pros and Cons
This is the fastest way to eliminate debt and save on interest payments. However, it can take years to eliminate this debt while other smaller bills still trickle in.
Which option is best for you?
It comes down to what you feel most comfortable with. Ultimately the best method is the one you can stick to. If you’re motivated by quicker victories, the snowball method may be the right option for you. If you want to pay the lowest amount of interest, you’re likely better off choosing the avalanche method.
Did you know that April is Financial Literacy Month? An entire month devoted to learning about money may sound extreme… until you read the stats. According to a recent survey, only 57% of adult Americans understand basic financial concepts.
A lack of knowledge isn’t just bad for your brain; it’s dangerous for your wallet. So here are some simple actions (based on fundamental financial concepts) that will boost your saving power.
- Start an emergency savings account
Car repairs, medical emergencies, last-minute necessities… we all get hit with surprise costs from time to time. The best way to ensure that you stay prepared is to start an emergency savings account. If possible, try to keep this separate from your regular savings account, so you don’t have to drain funds for those future costs that you can actually predict.
- Review your student loan repayment options
When’s the last time you checked your monthly student loan payment? Is it so high that you can’t pay the rest of your bills? If it’s too low, you may end up paying more in interest over the life of the loan than you need to. If you need to adjust your payment, you may be able to negotiate your monthly sum with your servicer.
- Open a retirement account
Saving for retirement is critical (unless you plan on working full-time forever). If your employer offers a 401(k), make sure you take advantage of it. Even putting small sums away every month can make a big difference later once you lose full-time income. Likewise, if you don’t have access to an employer-sponsored retirement plan, open an IRA with a financial servicer.
- Set financial goals
Setting financial goals will ensure that you get what you want in life, and help you save money in the long run. Goals should fall into three categories (short, medium and long-term). For example, a new computer may be a short-term goal, while a new home will take months or even years of consistent savings; this would be a long-term goal. Once you set your goals, create a realistic timeline for achieving them.
You can schedule an in-branch appointment with a SafeAmerica service representative to discuss how we might be able to save you some money each month.