How to Stick to Your Financial Resolutions the Right Way
So the New Year has started and you made your financial resolutions; but have you been following through with them?
Financial resolutions can be hard to stick to but there are multiple things you can do to get them back on track and make them stick.
Adjust Your Budget
If one of your financial resolutions was to make a budget, evaluate why you aren’t following through. Every month your spending may fluctuate based on varying expenses; a budget that is too rigid will only work against you and may cause more financial harm than good. Leave a little wiggle room in your budget each month for “miscellaneous” expenses.
Have a System
Setting up a routine to check your finances will help you stick to your financial resolutions. Whether you use a budgeting app or handwriting your expenses, you will be able to better stay on top of your expenses. Being able to continually track and stay on top of your finances will help you to stay motivated and stick to those financial resolutions.
Learn from Your Mistakes
If you know you have a problem with impulse purchases or going over your holiday budget and getting yourself into holiday debt, then it’s time to really sit down and evaluate those expenses. By evaluating what those purchases were and whether they were truly worthy purchases, you can become more financially aware and be better able to reign in your spending.
Once you become aware of your spending mistakes, you can take them and differentiate between “needs,” and “wants,” and which “wants” are worthy purchases. This is where the miscellaneous part of your monthly budget will come in. It’s alright to treat yourself every now and then, as long as it doesn’t break the bank.
Often times unforeseen expenses can lead to a “debt snowball.” Whether it’s due to lack of budgeting or having an unforeseen emergency expense, then it can be easy to get off track due to overwhelming debt. A great way to avoid this and stay on top of your financial resolutions is to leave room in your budget to contribute to savings and your emergency fund each month. Having a backup plan helps you be prepared to weather any financial storm that may originate. The second you have a tremendous expense, many people lose sight of their goals and ultimately continue to take on debt because they weren’t prepared.
Have more ways to get back on track with your new years’ financial resolutions? Need advice on how to get out of debt and take control of your finances? Give us a call today or leave a comment below, we’d love to hear from you!