Financial goals you can set for 2015 that will still be in tact by 2016.
We all set financial goals when a new year’s just around the corner, but unfortunately most of us struggle to stick to them. Goals of any kind are a lot of pressure, and plant the idea in our heads that we’re not going to be happy – or our life won’t really begin – until after our goal is met. But then we meet the goal and set a new one, and the cycle of torture starts all over again.
Instead of focusing on the end result of your financial goals, focus on the process of getting there. Think cyclically: Instead of saying, “I’m going to save $3,000 by the end of the year,” say, “Every payday I’m going to put away X number of dollars.” Focus on the simple act of sticking to your schedule, and before you know it you’ll have way more than $3,000 in your savings – plus the added bonus of feeling a sense of accomplishment at the close of every cycle.
You can create cycles for each financial goal you want to set, and use the end of each cycle to reassess for the next one. The easiest way to do this would be to align each cycle to your weekly, biweekly or monthly pay schedule.
Here are 7 financial goals you can accomplish on a cyclical basis:
1. Make more money
You’d be surprised at how many of us only have a general idea of how much we bring in each month – which is not cool for those of us who aren’t on a salary. It’s important to reassess this number every month in case any adjustments to your budget need to be made so you don’t go into debt. From here, you can make plans to gradually increase your income.
2. Stick to your budget
If you want to stand a chance at reaching your financial goals this year, then you have to create a budget. List your monthly expenses that don’t budge – mortgage/rent, car payment, cell, etc. – then deduct this amount from your monthly income to see what you have left to work with. Use what’s left and create spending limits for your groceries, gas, entertainment, and any other fluid expenses you have. Then you know, stick to it.
3. Spend less
With your new budget in hand, take it for a test drive. At the end of every month, reassess to figure out what categories you may need to add more money to, what categories you can save money on, and (if applicable) how much you’ll be able to put toward your debts the following month. Tracking your spending makes the difference between steering your financial ship safely – or hitting an iceberg, especially since more often than not we spend more than we think we do.
4. Pay your bills on time
Using your cell phone, iPad calendar or a service like Mint, collect the due dates for your bills and set reminders to ensure you never have to deal with late payment fees again.
5. Improve your credit score
Errors in credit score reports are more common than we’d like to believe, and could be what’s standing in your way of scoring better interest rates for your loans and credit cards. Make it a point to check on your credit score every quarter to decide what improvements you should make.
6. Start an emergency fund
They say you should keep an average of three to six months worth of expenses in a savings account just in case something crazy happens – your car breaks down, your relationship falls apart, or an anvil falls on your head. (Kidding. Sort of.) Instead of panicking over the fact that your savings account has 35 cents in it, think cyclically: “I’ll take X number of dollars out of each pay check and place it into a high interest savings account.” Do yourself one better and setup an automatic transfer through your bank.
7. Pay down your debts
List all of your debts and decide what order you want to pay them off in. Make sure your minimum payments are covered in your budget first, then decide how much you can swing in the form of additional payments and add them to your cyclical schedule. Bam.
What are your financial goals for the new year?
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