New Year + New You = New (Money) Resolution

New Year’s Resolutions typically include goals such as losing weight, exercising more, quitting a bad habit, or learning a new skill. There is nothing wrong with these, of course. But, what about your money habits? Were you able to make it through the holidays without getting into credit card debt, spending more than you intended, or worrying about how you are going to pay your bills next month? If not, please keep reading.

Good money habits should not be overlooked when determining your New Year’s Resolutions. It is no secret that money problems are a leading source of stress and anxiety and in extreme cases, divorce. Organizing and getting a financial plan together can bring relief and also get you on a better path to achieving your goals. It’s time to start having your money work for you instead of you working for your money.

Of course, trying to make broad, sweeping changes all at once makes forming any habit more difficult to stick with for the long term. The following are a few simple ideas to help you get started.

1. Automate, Automate, Automate. It’s easy to spend money that’s in your pocket, but what if that money never found it’s way into your pocket to begin with? That’s the concept of paying yourself first. And the best way to do that is to set up systematic (or automatic) transfers to savings, retirement accounts, and pay down credit cards (more than the minimum). Most people find that setting this up via their paycheck is the easiest. What you do not see, you do not spend. What is left is for you!

2. Track Your Spending. If you have not already started using a budgeting app that tracks your spending, it’s time to get one. Some, such as Mint.com, are free and even provide your credit score. Mint.com, for example, will put all of your accounts in one place to help you see where money is being spent, in what categories, and also set spending limits within particular categories. Linking your accounts is easy and a good first step in setting up a budget.

3. Check Your Credit Reports (Once Per Year). Like it or not, your credit history dictates everything (well, almost everything). Please refer to my first blog post, “This 3-Digit Number Could Save You Thousands.” Once every 12 months, you can check your credit report free of charge from all 3 bureaus (Experian, Transamerica, and Equifax) by visiting www.annualcreditreport.com. You will want to ensure all lines of credit have been reported accurately and your contact and personal data are up to date. The information on your credit report is what drives your credit score. This number determines the interest rate lenders will charge you (if they are even willing to loan you money), whether you need a co-signer, or pay a security deposit under some circumstances.

4. Make More Money. Especially the ladies! We, generally speaking, do not ask for raises or negotiate our salaries the way that men do. This is the year to get paid for your value and your worth! Perhaps you decide to take on a side hustle. Whatever you do, be confident. More money means more possibilities and opportunities for you to save, pay down debt, and ultimately give you the freedom to do what you want.

I hope this gives you some easy ideas to start developing good money habits. Remember, small steps equal big results. Over time, these changes become habits and you can begin the New You in the New Year (and beyond!). Happy New Year!