Have you already forgotten about or blown all those new year’s resolutions that you set for yourself last month? If you have, don’t worry – it’s still early enough in the new year to set some additional financial goals and attain them. In the process, you may even save yourself some money! Keep reading to see how you can remain on a great financial path for 2022, even if you already took a small detour.
Refinance your mortgage. Mortgage rates are still low. Do the math, and check out your current mortgage rate. If it’s on the high side, you may want to consider refinancing to a lower rate and lower monthly payments. This will allow you some wiggle room in your budget to put in your savings account, pay toward other bills, or even apply more to your mortgage principal and pay your home loan down sooner.
Pay down debt. If you racked up a lot of credit card debt recently, make this the year you vow to pay it off and finally be financially free. Getting out of debt takes a lot of discipline, but you can do it! An easy way to start is by creating a spreadsheet and listing out all your balances owed, interest rates, and minimum monthly payments. Then you’ll need to create a debt repayment plan for yourself, to decide which to tackle first (usually the one with the highest interest rate and you’ll need to make more than the minimum payment each month to get it under control). If you need some help with a debt repayment plan, check out our credit management and debt reduction guide.
Create a budget and stick to it. No matter how much you bring home, creating a spending budget can still be a challenge. However, sticking to a budget that you set for the new year can really pay off in the end. If you need help getting started, check out our useful budgeting worksheet.
Stop overspending. If you’re using the budget you created and learning to automate savings by having extra funds sent to a special savings account from your paychecks, it should be a little easier to stop overspending. Here’s an eye opening spending challenge to try: don’t spend even one penny on anything you haven’t budgeted for the week (this includes morning coffee stops, lunch out, even a lottery ticket purchase or a pack of gum). At the end of the week, see how much more is left in your bank account by not purchasing all those little extras that can really add up.
Plan ahead, but don’t forget to look back too. Do you have any big life events coming up (weddings, births, vacations, retirement) that could definitely affect your bottom line? If so, start thinking about them now and putting some money away. This is also a good time of year to review all your current accounts and ensure you have up to date beneficiaries listed. Besides planning ahead, it’s also a good idea to look back on the previous year and take note of what might have gone wrong financially. If you didn’t have enough in your emergency savings account (or if you don’t have an emergency savings at all), this should be the year you start one or add some extra funds to it.
As always, if you need help creating and sticking to a financial plan – don’t hesitate to setup an appointment at your local First Financial branch. We’re happy to help!
*APR = Annual Percentage Rate. Subject to credit approval. Credit worthiness determines your APR. Rates quoted assume excellent borrower credit history and are for qualified borrowers. Your actual APR may vary based on your state of residence, approved loan amount, applicable discounts and your credit history. Higher rates may apply depending on terms of loan and credit worthiness. Available on primary residence only. The Interest Rates, Annual Percentage Rate (APR), and fees are based on current market rates, are for informational purposes only. Mortgage insurance may be required depending on loan guidelines. This is not a credit decision or a commitment to lend. If mortgage insurance is required, the mortgage insurance premium could increase the APR and the monthly mortgage payment. See Credit Union for details. A First Financial membership is required to obtain a Mortgage and is open to anyone who lives, works, worships, or attends school in Monmouth or Ocean Counties.