It’s that time again: Time to make your New Year’s resolutions. In addition to losing weight, exercising, or quitting a bad habit, many people are making financial resolutions for 2013. Here are a few tips to help you get ahead in the new year...
Virginia Credit Union
(Richmond, Virginia – December 18, 2012) -- It’s that time again: Time to make your New Year’s resolutions. In addition to losing weight, exercising, or quitting a bad habit, many people are makingfinancial resolutions for 2013. Here are a few tips to help you get ahead in the new year:
- Develop a budget. Make a new start in 2013 with a practical budget. Track expenses to determine where your money is going and consider where you can cut back. Personal financial management tools like MoneyTracker, which Virginia Credit Union offers to its online banking users, can help you monitor spending, establish a budget and set savings goals.
- Review basic accounts. Check to see if your savings and checking accounts are properly allocated. Look for checking and savings accounts with no minimum balance in order to avoid fees.
- Examine the rates you’re paying on debt. To reduce the cost of your debt, consider whether refinancing your car loan or mortgage would make sense. By lowering your interest rate, you could save on your monthly payment or shorten the term of your loan. Carrying a large balance on your credit card? Transferring the balance to a card with a lower rate could help you pay off your debt faster and save money.
- Establish emergency savings. Most financial experts agree everyone should have emergency savings. Three to six months of essential living expenses is the recommended target in the event of a job loss, medical emergency or other crisis.
- Pay yourself first. Consider your savings an essential expense. If your employer offers direct deposit, you may be able to automatically put a portion of your paycheck in savings. A good target to work toward would be saving at least 10 percent of your monthly income. If that’s a stretch for you, start small and build up.
- Sign up for automatic savings programs that round the amount of your debit card purchases and transfer the change into your savings account. Over time, those small transfers can really add up.
- Set a goal. Once you’ve established sufficient emergency savings, begin saving toward a specific goal. For example, saving a little all year long could make your holiday shopping a lot less painful next year. Or, you could accumulate enough to make a sizable down payment on a major purchase.
- Don’t neglect the long-term. Take advantage of employer-based retirement savings programs. It will reduce the amount of your taxable income and may carry a matching amount from the employer. Depending on your age and family situation, you may have other long-term goals, such as college education for a child or grandchild.
- Seek help. Long-term financial goals require thoughtful planning. Everyone’s situation, time horizon and risk tolerance is different, so go with a trusted financial advisor.
Follow these steps and you’ll be on your way to keeping your financial resolutions in 2013.
A member-owned financial cooperative with more than 220,000 members, Virginia Credit Union provides a variety of affordable banking services, loans and mortgages, checking and savings services, and financial education resources. Virginia Credit Union is federally insured by NCUA and is an equal housing opportunity lender. For more information, visit www.vacu.org.