Over the course of the past year or two, you may have not been able to truly give your finances the attention they needed. We hunkered down and focused on our physical health, our work, or maybe the lack thereof which may have caused other stressors.
Your financial health can be linked with physical health and when you focus on your finances, you’d be surprised how other things seem to start looking up too. If your finances aren’t in the best spot, your physical health may suffer in the end because of this.
So now, as we glide into 2022, having a grasp on how life has become, it’s time to give your financial life a boost in the New Year. Here are our Top 5 Financial Resolutions to work on in the upcoming New Year:
- Set A Budget – and actually put effort into it.
Not all budgets are the same. Some people prefer a weekly budget, and some prefer a monthly one. Some people check their budget devotedly, while others make look into it once or twice a year. The key is to make it work for YOU. So many make an attempt to budget with way too many gears turning, which tends to fail. Consider what is best for you; that might mean starting small, or it could mean doing a complete overhaul and being extremely disciplined.
If you already have a budget in place, the New Year is always a good time to reevaluate where your budget has been, are there improvements or adjustments you can make to boost your finances even just a tad bit more?
Don’t have a budget? The New Year is also the perfect time to make one and put it into action. Not sure where to start? That’s where we come in. At CSE the resources we can provide our members are plentiful! Here are just a few ways we can help you create a budget:
- Financial Counseling with our Certified Member Financial Counselor
- Banzai! Education Program, Articles, and More
- All of our other educational content through our website, and social media platforms.
- Put money away for a rainy day.
Saving is a vital aspect of your budget. A best practice is to put aside 20% of your take-home income. For example, if you made $1,000 take-home pay every two weeks, you’d want to try to save $200 each pay.
You could be putting this money back for a number of things such as an emergency fund, retirement, a down payment for a vehicle, schooling, to put down extra payments on debt, or more.
If 20% seems too steep, try saving 5-10%. Every little bit helps, and you’ll be delighted to see it all add up.
- Work on your credit score.
Did you know that a higher credit score means better interest rates, which is a long way of saying you could save money just by having a good credit score! Some financial institutions (like CSE!) may also have rate modification programs. That means if you have improved your score from the time you received the loan, you may be able to request that the lender looks at your current rate to see if it can qualify to be lowered. While that may not change your payment, you’ll pay less in interest and pay the loan off sooner than scheduled.
To improve your credit score, you need to pay your bills on time, carry less than 30% capacity on revolving trade lines such as a credit card and don’t go around opening a bunch of new trade lines.
- The no brainer…Pay your bills on time.
Although this one seems like a no-brainer, we understand that it can be difficult to pay all of your bills on time, depending on how many pennies you are trying to pinch.
The single greatest thing you can do for your credit score is pay bills on time. If you are late with your payments, it shows this on your credit report, and future lenders or creditors will be able to see your payment history. Embrace things like automatic payments and auto-transfers and CSE’s free Bill-Pay to make paying bills on time easier!
If it’s not a ‘forgetful’ issue, you might want to check out if there’s a grace period or a number of days after your payment due date that the payment is allowed to be late without getting a fee. Otherwise, not only are you dinging your credit, but you’re likely getting even more behind financially because of late fees that are being added to your payment or bill.
If you can’t pay your bills on time, take a look at ways you can adjust your budget in order to free up some money. This might mean cutting back on unnecessary expenses. Just remember, stay away from the payday lending cycle. It might be enticing to get some quick cash but the interest rates on payday loans are sky-high and many then fall into a cycle of getting another payday loan just to pay off their previous one.
- If you’re struggling, make a resolution to stage a self-intervention.
We know this seems a bit harsh for a resolution, but think about resolutions, they’re typically made to make your life better, and that’s what this one is all about. Budgets are hard; if they were easy, everyone would likely have great finances and never have any money troubles. So, if you try any of these financial resolutions and just feel like you’re falling short, or need a little help, why not fall forward and ask for some help instead?
That might mean asking yourself some tough financial questions, or, better yet, heading to CSE where we can help you with our one-on-one Certified Member Financial Counselor. It’s our job to help our members through hard financial times with loans and other products and services, but it’s also our job to help you understand your finances!
Our Financial Counselor is here to provide you with tools in figuring out the best way to budget, how to pay off your debts, and how to improve your credit, all with no judgment!
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