3 Strategies to Support Your 2022 Financial Resolutions
Paid by Discover® Personal Loans:
It’s easy to resolve to save money or pay off debt. It’s harder to keep it. And that’s especially true a few weeks into another year full of unknowns. Even in a “normal” year, an unexpected event – a marriage proposal, an impromptu family reunion, or a new job – can derail even the best-laid plans. You should also take into account any financial changes that may have occurred during the previous year.
“A lot can happen in a year; your income may have changed, your family may have grown, or you may have moved to a new home,” says Matt Lattman, vice president of Discover Personal Loans. “All of these things can affect your financial situation. Maybe you have new financial goals this year, like finally redoing your bathroom or starting a college fund for your child.
Here are a few small steps that can pay off big this year:
1. Take an overview of your year
Sit down and reflect on the year. What could happen? Maybe it’s a summer vacation or you’re planning to buy a new car. Either way, write down a list of upcoming expenses.
From there, take a look at your regular expenses, such as your mortgage, rent, car payment, or any other bills. Creating a list of what you earn and what you owe can give you a clear idea of exactly what your budget is, Lattman says.
You can also use the New Year to check all your monthly expenses, such as streaming service subscriptions, gym memberships, extracurricular activities for the kids, or other expenses you may have added in the previous year. . Is everything necessary or can something be cut? Lattman points out that cutting expenses can allow you to spend more money on other priorities, such as paying off existing debt or building an emergency fund.
2. Make a financial plan for the future
Once you take a close look at your current financial situation, it will be easier for you to make future plans for how you will spend your money. For example, if you want to take a family vacation this summer, your budget can help you gauge how you will cover the expenses.
While some people cover their expenses with a credit card, a personal loan may also be a good option to consider, Lattman says, adding that personal loans, which are unsecured – which means no collateral is required – can be a useful tool for achieving anything from your dream wedding to renovating your bathroom. “The process can be simple and quick. For example, Discover allows most people to make a decision the same day, and your money can be sent the next business day after acceptance. You can apply for up to $35,000 and you can check your rate without any impact on your credit score before applying. You’ll also benefit from fixed rates and flexible repayment terms so you can find a payment that fits your budget and know that the monthly payment will never change.
3. Create a budgeting system that works for you
Budgeting is not a “set and forget” system. A successful budget strategy comes from regularly assessing and adjusting your income and expenses, suggests Lattman. “If you’ve never paid close attention to your finances, this may be the year you really look at what you earn and what you spend, with a view to creating a budget you can live with” , he explains.
Consider setting money aside automatically each month for future goals, like creating an emergency fund, saving for home renovations, or increasing your retirement savings. If your cash flow is in check and you have savings in place, taking time to focus on your budget can also include reassessing and shifting goals for specific financial goals, he adds.
Tracking your budget, as well as other financial metrics like your credit score, can be done monthly or weekly. The key is to have a system in place that works for you so you can continually review and adjust financial strategies. It can also be a good idea to celebrate your financial gains. “Simple actions like setting a budget or keeping tabs on your credit scores and account balances can help prepare you for any challenges that arise,” Lattman says.
From Discover Personal Loans:
You can save hundreds or even thousands of dollars on interest when you pay off up to $35,000 in higher rate debt with a Discover personal loan. To estimate your savings, see The Discover Debt Consolidation Calculator and enter your outstandings. Discover charges no set-up fees and offers flexible refund terms so you can choose the option that’s right for you. Learn more about how Discover personal loans can help you achieve your financial goals.
Discover grants loans regardless of race, color, religion, national origin, gender, disability, or family status.
This article was paid for by Discover Personal Loans and created by Yahoo Creative Studios. Yahoo Finance editorial staff had no involvement in the creation of this content.