YOUR FINANCIAL NEW YEAR’S RESOLUTIONS

With the New Year upon us, millions of people around the world make their resolutions, and hope and plan to stick with them throughout the year.

Here are some ways to make sure that you at least keep your financial ones.

1. Set SMART goals.

When we set a vague goal like “save more money” or a seemingly insurmountable one like “pay off all debt,” we’ve already set ourselves down the path to failure.

Instead, you want your goal to be SMART: specific, measurable, attainable, realistic, and time-sensitive.

2. Determine how you’ll invest for each goal.

For goals to be funded within the next two years, you’ll want to keep your money somewhere safe like a bank account or stable investment fund that doesn’t fluctuate in value.

For longer term goals, it probably makes sense to take some investment risk.

3. Calculate how much you need to save per month.

For debt, you can use debt calculator to see how quickly you can be debt free.

4. Look for tax-advantaged ways to save.

Some examples are your superannuation savings with pre-tax money for retirement, education funds, and borrowing to invest.

5. Minimise your costs.

Look to improve your spending habits to achieve your goals.

6. Automate your payments.

By automating your savings, you make sure that they take priority versus saving whatever you have left at the end of the month.

7. Adjust as needed.

Once or twice throughout the year, you’ll want to revisit your goals, re-run your calculations based on your actual investment returns, your loan balance, see if tax laws or interest rates have changed.

No matter what your financial resolutions are, there are ways to become motivated again and get back on track.

A good financial adviser and financial plan can help you achieve that.