The new year is upon us, and as we start breaking the first sets of our resolutions, it’s time to get to work making a more practical second series of promises. And a good one for you, and the people around you, is going to be to live a more financially sound 2017. You want more control of your money, and you want less anxiety about your debt. These things are possible with a bit of foresight and some grit.
Consider the five-step plan of getting your credit in order, setting realistic goals, taking on the idea of habits, using flexible budgets, and recognizing the interconnectedness of your interests, and then you’ll be 90% of the way there.
Get Your Credit In Order
Fiscal responsibility is going to start this year with a serious look at your credit situation. Are you in manageable debt, or do you have a pile of bills just sitting on your head waiting for you to pay the minimums every month until you’re old and cranky? The first thing on your new financial focus list is to get that credit in order. No more spending what you don’t have, and pay as much as you can possible afford onto your debts every month starting now.
Set Realistic Goals
“Making a million dollars” isn’t necessarily a realistic financial goal. If you want to set something up that you can be happy with, find a financial goal that you can actually achieve, like saving a few thousands dollars more than last year, or maybe asking for a raise to get 10% more money, or maybe starting a side gig so that you can earn passive income on the side while you’re still keeping your day job.
Take On the Idea of Habits
Do you know how habits work? Because once you get into the psychology of them, you can adjust your habits that work with your income and expenses. Prop up the habits that you have that make you money, and get rid of habits that you have that cost you. It’s really that simple!
Use Flexible Budgets
Another good tip is to use flexible budgeting instead of static types. Your needs are going to change from month to month. Consider that heating and cooling bills are going to be different in different seasons. To avoid setting yourself up for financial failure, allow yourself some flexibility so that you can avoid the disappointment of things not working out perfectly at first.
Recognize the Interconnectedness of Your Interests
When it comes down to it, money does not exist in a vacuum. What you enjoy, what you eat, and how you go about your day will all affect how you spend your money. And that’s why looking at your life holistically will help you determine how to approach your personal financial situation.