January 5th, 2016
Most of us look at the beginning of the new year as a time to make changes or to set goals for the year ahead. Financial health is one of the top 10 New Year’s resolutions, according to StatisticBrain.com, and pretty much every other list available on the internet. So we talked to our Business Office team, experts on healthy finances, and they compiled the following list.
Ten tips for getting fiscally fit in 2016
- Our finances usually take a big hit after the holidays, but according to Jean Chatzky, Financial Advisor to NBC’s Today show, there are some things you can do in the year ahead to help you control that holiday spending. Many people “self-gift” during the holidays. One of the things you could try is the one in/one out rule, which can help you cut down on stuff in general. Here’s how it works: Before you allow yourself to buy another pair of boots (or pants, or iPod), you must get rid of one you already own. Even better, sell the oldies (either at a consignment store or online) and use that money to make a dent in the new purchase.
- Make a 30-day list for the things you’d like to buy for yourself. With this, you write down the items you’re coveting and revisit the list in 30 days. If you still can’t imagine living without the item a month later, then consider the buy. Chances are the item will have been long forgotten, according to Chatzky.
- Find small savings that add up to big savings over time. Record all of your expenditures for a month and add them up. You’d be surprised at how the lattes, iced coffees, restaurant meals and takeout add up! Try getting up a little bit earlier and making your lunch for work and drinking coffee from work or making it at home. Our Colleague Joyce Pharmes recommends preparing homemade dinners – it’s cheaper! Don’t deprive yourself completely, but cut down.
- For necessary purchases, shop and compare to find the lowest prices. Take a list to the grocery store and stick to it. Joyce also recommends, and we all agree, not going to the grocery store hungry!
- Limit spending for birthdays and holidays and opt for homemade gifts or services. AmericaSaves.org recommends washing a car, babysitting, providing rides, etc.
- Our Business Office Colleague, Valerie Luque recommends saving for emergencies. Ask your bank or credit union to automatically transfer funds each month from your checking to your savings account. Even as little as $10 or $15 a month helps.
- Put all of your loose change in a jar. When the jar is full, roll your change and deposit it into a savings account.
- Always pay more than the minimum payment on your credit card bill. If you only pay the minimum payment, it can take years, even decades, to pay it off, according to MyCreditUnion.gov. If possible, pay off your credit card balance in full every month. Valerie also recommends that you live within your means, meaning if you can’t pay it off at the end of the month, don’t charge it unless it is absolutely necessary (ex. car repairs).
- Some low- and moderate-income workers qualify every year for an Earned Income Tax Credit. IRS publication 596 explains how to apply.
- If you are having trouble finding extra money to save, here are a few ideas: Do odd jobs for family and neighbors; start a dog walking, lawn mowing or snow blowing service; child care; car washing/detailing; house painting; part-time job. Commit to putting at least 50% of the extra money made into savings.
Our financial health experts also recommended developing a budget for 2016. Besides all the money saving tips above, it’s important to keep track of spending, necessary and non. It will allow you to reflect on your spending habits as well as plan for future expenses. You can download free budgeting apps for your phone like Wally, BillGuard, and Dollarbird. Or check out the U.S. News Money Blog for a few ideas to set up your own budget.
Have an idea for saving money? A budget program or template that you really like? Please share your tips below.
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