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January 04, 2022 Personal Finance

Setting New Year Money Goals

If you are like most people, the beginning of a new year marks the kick-off for the well-liked tradition of new year resolutions. From losing weight to taking up a new hobby, eager participants make a wide variety of self-improvement goals or habits they hope to achieve throughout the year.

This year, try adding a resolution to improve your finances. Spend less, save more, pay down debt — how can you make 2022 the year you stick to these and other financial resolutions?

Below, we’ve compiled a list of tips that can help you make financial goals that are more manageable to keep throughout the new year.

Set Measurable Goals

Instead of simply setting the goal, create realistic goals that you can measure. To help you stay on track and ensure you’re making progress, keep those goals SMART: Specific, Measurable, Achievable, Realistic, Time-based.

For example, a specific goal would be to save a certain dollar amount by the end of the year. You would measure this by taking that dollar amount and dividing it by a time-based measurement: 12 months or the number of paychecks you receive within a year. To achieve this goal, you would need to be sure the amount dedicated to saving fits your budget and lifestyle. If it doesn’t, change the amount you want to save until it is realistic.

Spend Mindfully

Creating a budget can take some time and lots of number crunching, but it’s not the real challenge of financial wellness. The hard part comes when you need to stick to that budget and make it part of your life. Many people don’t keep their budget because they spend money without consciously thinking.

Strive to be more mindful about your spending this year, which means thinking about what you’re doing when you swipe that card or hand over cash to the cashier.

Before making a purchase, take a moment to think about what you’re purchasing and how much you’re paying for it. You can also set yourself up for better success by setting up banking account alerts and spending limits alerts.

Try this calculator to determine how much you earn in an hour and see how much of your work-time you’re “spending” when making a large purchase. Is it worth the price?

Partner Up With a Friend

Choose a friend in a similar financial bracket as you to help hold you accountable to stick to your resolution. It helps if they have a similar goal to set and stick to those financial resolutions together.

Set up a time to review each other’s financial progress or regression. Come prepared with details on how you’ve handled your money and the SMART goals you’ve set in place to help you achieve that goal.

Check if your financial institution has an included account budgeting portal. You can use a money management app, like Mint, to help you track your spending, find your weak areas, and stay accountable for your friend.

Write It Down

The convenience of technology has made writing down New Year’s resolutions tedious and outdated. But writing doesn’t need to be a physical act of writing on paper. You can use a resolution-tracking app, like Strides, where you can record, track and reference your New Year’s resolutions at any time with just a few quick clicks.

Just the simple act of putting your financial resolutions into writing will help to imprint them on your memory. Plus, you’ll have a list of your goals to reference throughout the year to help keep you on track.

Sticking to your financial resolutions isn’t easy. Follow the tips outlined here to make 2022 the year you genuinely get your finances into shape.

This article is for educational purposes only. WeStreet Credit Union makes no representations as to the accuracy, completeness, or specific suitability of any information presented. Information provided should not be relied on or interpreted as legal, tax or financial advice. Nor does the information directly relate to our products and/or services terms and conditions.