Create That Budget

Yes, you hear this often when it comes to your finances and perfecting them, but it is key to sticking to your financial goals. Also, a realistic budget is key. Don't set yourself up for failure thinking you won't spend any money on fun things and only bills because you will fail. Make sure you are allowing for the little luxuries, so you don't burn out on only paying your bills.

Don't forget that a budget can be flexible as well. If you overspend in one area, you can balance it by cutting back in another area. If you discover that you keep having to make changes, don't abandon the budget altogether. Instead, tweak it part-way through the year and keep moving forward.

Pay Down Those Credit Cards

The average amount of credit card debt per consumer in America is well over $5,000, and interest rates just seem to keep climbing. My first suggestion with credit card debt is to snowball it. Start by paying off the smallest balance first. Then when that balance is paid, apply that payment plus the payment on the next largest balance. By the third or fourth balance, the snowballing amount of a payment you can make will have grown immensely and can take down those higher balances quicker.  

If you're struggling to make payments, you can consider credit counseling or a debt consolidation loan as well. With credit counseling, I recommend https://credit.org/cccs/ Consumer Credit Counseling Service is a national non-profit organization that can help you work with your creditors to get out of debt. Consolidation loans, on the other hand, can help you get all your payments into one, usually saving you money on your payments. Be wary of the interest rate, though sometimes, those can be much higher than what you are paying on a credit card.

Get Serious About Your Emergency Fund in 2020

I read a statistic once that said something like 70% of Americans could not come up with a $1,000 in an emergency, and that is a terrifying thought. Start with a small amount each paycheck into an account you do not see regularly. I fully subscribe to the out-of-sight, out-of-mind idea when it comes to my savings. Also, if you can automate it in some way, it becomes even easier.

Invest in Your Future

Planning for your retirement should be a top priority, especially if your employer offers a match on a retirement plan. If you're not taking advantage of the employer-matched funds, you are leaving free money on the table. I suggest contributing 10% of your income to your retirement savings, but if you can't do that much, start with what you can and work your way up to 10%.

Bring That Credit Score Up

When you are focused on increasing your credit score, other parts of your financial life seem to fall into place. Did you know your score can impact more than just the ability to get a loan? Your car insurance, your employment, even whether or not someone will rent to you, can be affected by your credit score. You should also be focusing on improving your credit score because when you do borrow money, you will get it at a cheaper rate if your score is higher. It's a win, either way, you look at it.

You Have Food at Home

I'm not telling you that cutting your latte habit will make you a millionaire, but I am suggesting the less you eat out, go out for coffee, or getting a beer that costs the same as a six-pack, the more money you will have for other things. So maybe consider what is in the refrigerator before ordering from DoorDash.

Update Your Beneficiaries

I know this is a morbid thought, but it is one I am now an expert in. Make sure each account you are the owner of states a beneficiary. This will make any processes much easier for your loved ones in the event of your death. I was lucky, my husband named me as the beneficiary on all of his accounts, and it made the awful process after his passing just a little bit easier. Just trust me on this, your checking account, 401k, IRAs, savings accounts, and investment accounts should have a clear beneficiary.

And Finally, Find Ways to Increase Your Income

Ask for that raise; you've earned it! You can also use apps like ThredUp, PoshMark, and Mercari to sell your clothing and housewares without having to use social media or host a garage sale. Most apps allow you to take a picture of the item you are selling and upload it. You price it, and away it goes. You can also freelance your talents for additional income. Are you a great writer, graphic designer, or web designer on the side? Use those skills to make some extra cash throughout the year. Every little bit helps!

Well, there you have it. Eight fairly easy steps to follow in the New Year to get your finances back on track. Have you tried something not on this list to get your finances in order? Let me know!
Happy New Year.