The new year is a time for fresh starts and positive changes. This year, 66% of Americans are resolving to fortify their finances by paying off debt, saving more money, or cutting back on discretionary spending.[1]
If you’d like to join this group of financial-savvy individuals, now is the perfect time to do it.
Below, we’ll outline five tips to help you get your finances in order this year.
#1 Put Your Bills on Auto-Pay
Paying your bills on time can protect your credit score and help you avoid late fees. However, manually tracking each bill’s due date can be tricky and time-consuming.
You can simplify your bill-paying process by setting up automatic payments. Many companies allow you to enroll in auto-pay online or over the phone. For example, you may be able to automate payments to your:
- Landlord
- Lenders
- Utility providers
- Insurance companies
- Phone company
Once auto-pay is all set up, you can relax for the rest of the year knowing that all of your recurring bills will be paid on time.
#2 Update Your Budget
Sticking to a budget can help you reach your financial goals, whether you want to:
- Get out of debt
- Contribute more money to your retirement accounts
- Beef up your emergency fund
- Save up for a big purchase or vacation
During the new year, it’s a good idea to reevaluate your budget and see if there’s any room for improvement. For instance, maybe you notice that you spent a lot of money on food delivery services in 2022. Or maybe you discover that you’re paying for five different video streaming services, though you only use one or two.
These may seem like small expenses, but cutting back on these can help you make more headway on your current financial goals. Think about it like flowing water. Tiny creeks combine into gorging streams, and gorging streams culminate into strong, gushing rivers.
#3 Make a Debt Payment Plan
This year, the most popular financial new year’s resolution is to pay off debt.[2] If you share this goal, the first step is to make a debt payment plan.
You can do so by:
- Making a list of all of your debts
- Adding up all of your minimum monthly payments
- Seeing if you have room in your budget to make larger debt payments
- Making larger payments on your debts one at a time
You can tackle your debts one by one using the snowball method (where you pay off your debts in order of their balance sizes) or the avalanche method (where you pay off your debts in order of their interest rates).
#4 Check Your Credit Score and Credit Reports
Your credit score can impact your eligibility for loans, credit cards, apartments, and more. It can also dictate the types of rates and terms you qualify for.
Since your credit score is so crucial, it’s a good idea to check it at the start of each new year. Luckily, you can get a free copy of your credit report from each of the major credit bureaus every 12 months.
As you review your credit reports, make sure that all of their information is correct. The Federal Trade Commission estimates that one in five consumers have errors on their credit reports.[3] Disputing your credit report errors can ensure your credit score is accurate for 2023.
#5 Join the Best Credit Union New Jersey Has to Offer
Finally, you may want to reevaluate where you bank. Different financial institutions offer different perks. For example, here at North Jersey Federal Credit Union (NJFCU), we offer a variety of tools that can enhance your financial management in 2023.
Some of our customized tools include:
- Savings Goals – With an NJFCU account, you can create customized savings goals for emergencies, vacations, education expenses, and more.
- Spend Forecast – You can also receive helpful spending predictions by uploading your monthly expenses.
- Spending Analysis – Want to review how your hard-earned money is being spent? Just link your accounts to our Spending Analysis tool and it will crunch the numbers for you.
- Financial Health Checkup – We can grade your financial health throughout the year using seven key indicators.
- Credit Score Calculator – As an NJFCU member, you can keep tabs on your credit score and key credit report information (such as your payment history, credit utilization, and length of credit history) without impacting your score. We can also send worthwhile pre-qualified credit offers your way.
Along with these financial wellness tools, we also offer tax discounts, exceptional customer service, and affordable credit cards and personal loans NJ residents can take advantage of.
Are you ready to reach your financial new year’s resolutions this year? Become an NJFCU member today.
SOURCES:
[1] [2]The Motley Fool. 81% of Americans With Financial New Year’s Resolutions See Inflation as a Spoiler. Source Link
[3] Consumer Financial Protection Bureau. Common errors people find on their credit report – and how to get them fixed. Source Link
