Well, we’re already a few weeks into the new year, which means it is definitely time to get your finances in order. Chances are you spent more than you had planned in December: Christmas cocktails, a new dress, gifts, a bottle of wine for the dinner party you attended … the list goes on. But December and all the rest of 2013 are done and over with, and now that 2014 is here, you have the chance to retake charge of your finances. This is the year to finally set that budget and stick to it along with setting some other great financial resolutions that will set you on the path to financial freedom.
We’ve already discussed how to make a budget, and for 2014 you should focus on making it realistic. Make sure you add in a line for savings and for the financial goals you hope to achieve in 2014. It’s never too early to start saving for the future! Allow yourself a buffer in your monthly spending – this will ensure your budget is flexible and you aren’t broke if you go over one month.
Once you’ve created a realistic budget, you’re ready to set some fantastic goals for 2014 that will make you feel more successful and financially secure. Here are three fantastic financial goals for 2014:
- Pay off or make a dent in that debt – You’re debt is a monster that follows you around, and unfortunately throwing money at it is the only way to get it to leave you alone. Make a goal to pay off all your debt or if that seems unrealistic set an amount or percentage you would like to see your debt decrease by this year. Then proceed to throw every penny you have at your debt. Find $20 in your pocket? Immediately transfer it to your debt. This is called debt snowballing and it will help you get rid of your debt much more quickly!
- Increase your net worth – It’s time to start accumulating wealth. If you have a negative net worth, make one of your 2014 financial goals having a positive one. Increasing your net happens two ways: paying off debt (see point one), or by saving! If you’re socking money away into a savings account, start thinking about investing it so that you earn some sort of return. You can use programs such as NetworthIQ to track your progress and see how you compare to others in the same age or income bracket.
- Start an emergency fund – It’s never too early to start your just-in-case fund. Socking away a couple hundred dollars a month will most definitely help you if you find yourself in a pickle. Emergency funds are so important when it comes to financial independence, you don’t want to be living paycheck to paycheck or be going into debt every time an unexpected expense comes your way.
By making financial goals for this year, your money will be better spent and in better shape by the time 2015 rolls around. Money is a manageable commodity and, by setting goals, you can take charge of your own finances.