How To Keep Financial Resolutions In 2020
Have you made financial resolutions for 2020? Looking forward to manage your finances in a best way in New Year? Need some idea to keep financial resolutions in 2020? Here are best money tips to consider for 2020:
1. Know Where Your Money Is Going
In order to keep financial resolutions for the New Year, you first need to track your spending. By actually doing that you can get to know where you money is going. You can start it by looking at your bank and credit card statements for three months at least. You can record your expenses on a spreadsheet or by using a pen and a paper. You can track your cash by writing down all your expenses.
2. Make A Proper Spending Plan
The budget will only work as long as you stick to it. It is important not to spend more than you earn. It is necessary to save certain amount of funds every month if you want to reach your financial goal. Divide your expenses and see where you can cut down and also separate your needs from your wants.
3. Have An Insurance Coverage
Make sure you have all kinds of important insurance coverage including auto, health, life, homeowners and renters insurance. See what coverage you can get and compare all insurance plans carefully to choose the best one.
4. Build An Emergency Fund
In order to manage your finances you need to reserve enough cash to cover necessary, unexpected and important financial expenses for at least three to six months.
5. Match In Your Employer’s Retirement Plan
It can be a blessing for an employee to have an employer that matches your contributions for your retirement. Try to contribute enough to get that full match. This is how you can save enough finance for your future.
6. Pay Off High Interest Debt
If you have debt with interest rates over 4 to 6% then you can able to save more by paying off the debt. See if you can negotiate your interest charges or can refinance. You can use calculator to see how quickly you can repay the debt and become debt free.
7. Use The Autopay Option
Set up your bill son autopay option if you really want to avoid missed payments. You can also protect your credit by checking your credit report from time to time by three credit agencies. By this way you can protect yourself from any theft or errors.
8. Use A Retirement Calculator
If you want to have an estimate of how much you need to save to reach your retirement goal, you can easily use the calculator available online. This calculator will let you know whether you are on right track to hit your retirement goals and if not then what you can do to achieve your goal.
9. Save For Education
Education is a foundation of strong and determined future. So, you must save for your child’s education and can use calculator to know how much you need to save. Most college savings plan offer tax-free earnings for education.
10. Diversify Your Investments
Determine the risk and return of your investment portfolio by allocating your assets or by knowing how your money is divided between basic asset classes like stocks, shares, bonds and cash.
11. Treat Yourself From Time To Time
Don’t forget that the ultimate purpose of money is to provide basic needs to you and your family. Once your needs are well take care of, treat yourself by taking care of your wants like vacation or occasional outings with the family.
12. Create Financial Goals From Short-Term To Long-Term
Creating financial goals will keep you moving and focused. You can make progress by achieving your short-term goals first like saving for retirement, education, shopping, vacation etc. Once you reach towards these goals by setting up a certain timeline for each goal, you can move ahead and start saving for your long-term financial goals like buying a home, purchasing a car or increasing your retirement savings contributions.
13. Mind Your Credit Record
You need to pay attention to your credit score derived from your credit report. Having a strong credit score could help you save tons of money when you work towards achieving your financial goals like buying a home or car. With affected credit score or having negative mark on your credit profile would mean that you will get the loan at a higher rate of interest. Also, your credit report could play an important role while you look for a new job, rent an apartment or apply for insurance.
14. Take Control Of Your Loans
Taking care of repayment process of the loan should be your financial resolution for 2020. Just make sure you never miss on a repayment and always pay your interest charges on time. By maintaining a good repayment rapport, you can able to build our credit score as well. Figure out which loan repayment you need to pay down and make record of your finances to avoid any penalty or late payment charges.
15. Beware Of Fraudsters
When you use credit cards, digital wallets, phone banking, there is always a room for fraudsters to steal your money. So, it is highly recommended to stay ahead of them by reviewing your bank and other online accounts regularly. Check your phone banking or wallet alerts for transactions and keep an eye on those transactions that you didn’t make.
16. Don’t Keep Your Money Into One Account
It is not advisable to put all your money into one account. You will be able to the best interest rate plans of all banks when you make full use of all options available by spreading your money across different banks.
17. Stick To The 50/30/20 Rule
According to this thumb rule, 50 percent of your income should go towards meeting your necessities, 30 percent of your earning should be allotted to your luxuries or wants and 20 percent of your income should be saved and invested towards your financial goals. By following and sticking to this rule, you can make your financial journey smooth and relatable.
18. The More, The Merrier Until You Use Them Wisely
It is not necessarily complicated to have too many credit cards. Having three or four credit cards can be helpful to get good discounts, coupons and other benefits offered by various credit card companies. You just need to make smart buying decisions which you can easily afford to pay back on time.
19. Control Your Impulsive Buying
It is easy to fall for huge discounts and offers coming your way time to time when you shop online or visit a store or mall. Whenever you go out for shopping just make sure to buy things within your budget or go ahead and buy those grocery stuff that you need and not you want.
20. Cut Down On Unnecessary Expenses
There are several ways where you can cut down on expenses such as ditching your expensive gym membership, saving on energy bills, buying groceries with a list in hand and sticking to it, disconnecting your cable connections, reducing your entertainment expenses, diminishing your dining out trips and more. Apply the all cash-diet method to restrict your purchases.