5 Financial Resolutions for the New Year

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5 Financial Resolutions for the New Year

As you may know, I’m all about smart spending but I have to admit that goes out the window a little bit during the holidays. I love shopping for gifts for my friends and family and while I try to stick to my budget, I always go over! This is one of the many reasons I practice smart spending throughout the year, so I can splurge a little during the holidays. If money pressures have got you stressed out, it may be a good time to set some financial resolutions for the new year! A recent Capital One survey found that only 1/3 of Americans felt they accomplished their financial goals in 2015. Don’t let this be you at the end of next year! There’s a reason why new years resolutions are so popular – January 1 is the perfect time to hit reset, start with a clean slate, and write down some new goals. Here are 5 financial resolutions to commit to NOW, so next year starts off on the right step!

1. Assess Your Priorities – When reviewing your financial situation, your first step HAS to be setting priorities! Or else your spending will be all willy nilly!! Generally priorities are things like shelter, food, and clothing, so start there. Factor in any important special needs for your family. Then start a second tier of priority items. For me, this includes things like traveling, cable TV, & my Disneyland annual pass. Everyone’s priorities will be different and there is no shame in listing “luxury” items among your top priorities. This article isn’t going to be telling you what you can and can’t have! But, making a list (and checking it twice *wink*) will help you clearly see where you’re spending your money.

2. Communicate with Your Partner, Spouse, and Family – A lot of married couples fight over money issues, but generally the issue is actually about communication! If you’re in a relationship (even if you’re dating a partner but not living together), it’s a good idea to discuss money! I realize this is a taboo subject for some people, but if you’re in a committed partnership, your income and budget shouldn’t be something to hide or ignore. Like it or not, money is vitally important to existence and it needs to be discussed. That’s not to say you can’t have your own stash. My husband and I have separate 360 Savings accounts through Capital One, and we also set up a shared account which makes it very easy to transfer money back and forth to each other. That way, my money is still mine and his money is still his, but we can help each other pay bills if needed. We love Capital One because their website is so easy to navigate, and their 360 Savings accounts have no fees and no minimums.

If you have kids, teach them the value of money early on. This is one of the best things my parents did for me as I was growing up. I was taught the value of money from a young age. I was taught that you have to do chores/work to earn your allowance/pay. I was taught that credit cards are tempting but they don’t equate to free money. Teach them realistic expectations about your financial reality and hopefully they will carry these lessons into adulthood.

5 Financial Resolutions for the New Year

3. Make Sure Your Credit Cards are Working for You – It’s okay to have credit cards, and ideally you’re paying off your credit cards every month. If you’re not, this is a good time to review your debt and make a plan to pay it down! If you have multiple cards, see if you can consolidate them into one account and negotiate the interest rate so it’s lower than what you were paying before. Taking an hour out of your life to make a phone call to your bank could potentially save you hundreds of dollars in unnecessary interest payments. For those of you who don’t carry over debt or have minimal debt, be sure you are earning rewards you can use. My husband and I love to travel, which is why we have a Capital One Venture Card. With double miles on every purchase and flexible redemption options, it’s perfect for us. We can redeem our miles on anything travel related – flights, hotels, even cruises. For us, it’s so much better than a card through a single airline or hotel chain.

4. Set Your Budget and Goals – Plan out your monthly budget for housing expenses, food, tuition, utilities, and anything else that is a priority. If you have leftover funds, set a budget for how much you can splurge. What can you spend on new clothing for yourself? What can you spend on dining at restaurants? What can you set aside for travel? Try to be conservative with your splurge money, so you’re not tempted to go overboard, and ideally you’ll have some leftover funds at the end of the year for your holiday shopping.

5. Don’t Forget to Treat Yourself – Adulting is difficult. If you accomplish Tips 1 – 4, you definitely are ahead of the curve and deserve a little treat. Splurge on a nice dinner or that handbag you really want or an extra glass of wine. Financial responsibility isn’t about saving, saving, saving as much as you can. It’s about spending wisely. So don’t forget to budget for little rewards now and then.

5 Financial Resolutions for the New Year

What are you doing to make the new year a financial success? Remember that small steps now turn into big rewards later, so don’t delay on committing to these financial resolutions!