Organize your finances for the new year

Did your midnight toast include a resolution to improve your financial health?

2018 gives you the opportunity to start fresh and simplify your financial life. We’ve put together some tips to help you stay on top of your bills, track your spending, and actually use your money for the things you really want. This is what you should do.

Have a strict budget

If you want to get ahead of your finances, it is extremely important to know where you stand and create realistic strategies to achieve your financial goals and objectives now and in the future. You may think budgeting is old school, but it’s still the best way to map out ways to help you manage your income and expenses. If you already have a budget, be sure to review it to make sure it worked effectively for you in 2017.

Don’t make budgeting time consuming or complicated. All you have to do is download a budget app on your mobile device that allows you to track your spending. When we say track your spending, we mean everything you buy with credit cards, debit cards, and cash. What you’ll find even after a month of tracking is the truth about where your money is going so you can plan for future spending.

Check all your statements

Be sure to set aside time each month to review all of your bills and statements. This is a good time to look for things you’re paying for but no longer need, or especially things you can cut back on. A good online application that can help you discover interest increases or additional charges or even auto-renewing subscriptions is Truebill.

Check out your credit union’s online money management tools

Credit unions offer online tools to help you with your financial management. How can I save up for that cool sports car, that dream house, or those toys for the kids? How much down payment do I need to save for that shack on the shore? What type of investment is best for me? Play with their calculators to make your financial decisions easier. And if you want to set a budget and track your spending, check out their FREE personal financial management software that can aggregate all of your financial relationships and help you set goals.

Financial calculators will help you understand APRs, APYs, amortizations and the power of money. Simply go to your credit union’s website and select a category that interests you:

Always prepare for the unexpected

As we all know, life can throw you some curveballs. Life’s challenges, such as job loss or medical problems, can leave you drowning in a sea of ​​debt. As you’ve probably heard before, it’s essential to create an emergency fund that can cover three to six months of expenses. Even if you can save just a little each month, you can build a cushion of financial protection.

Get rid of debt

Are you that person who makes only the minimum payments on your credit cards or other major debts? Did you know this means you’re paying mostly interest and barely trimming current balances? An effective method of reducing debt is to focus on higher-interest balances first, while making smaller, more timely payments on all other commitments. When you’ve paid off your high-interest debt, focus on the most expensive remaining balance and continue this way until you’re debt-free.

When your financial obligations are really out of control, combining your debts into one payment can give you the relief you need. Simplifying multiple debts into one lower monthly payment can help you pay your bills sooner. Your options include home equity, personal loans, and interest-free credit card balance transfers.

Make the most of tax deductions

Taking advantage of the appropriate tax deductions can help you avoid paying more tax than absolutely necessary. You may qualify for tax deductions that include:

• Interest deductions for mortgages, home equity financing, business financing, and student loans.
• Deductions for taxes already paid, including sales tax, foreign taxes, and self-employment tax.
• Business and home office insurance deductions.
• Deductions for charitable donations.
• Pre-tax contributions to IRA and 401(k) plans.

Open another checking account for intermittent expenses

If you have bills that appear periodically, such as insurance payments, quarterly taxes, etc. Open a second free account at your credit union and use it to house money for those one-off payments that come in quarterly or even annually. For those intermittent payments, it’s good to set aside a portion of those payments each month and when you need to make those payments it won’t strain your finances.

Reassess your assets and investments

Life can change quickly, so it’s important to review and change your retirement accounts regularly. It’s also smart to review your estate plan and make sure your will, insurance policies, and beneficiaries are up to date.

Make sure you have money to spend

As you create the plan to maximize your financial goals, be sure to allow money for incidentals like coffee, movies, or eating out. Remember, you can’t sacrifice everything to improve your financial health for the future.

Financial health = a happy life! So if you start the New Year with a bit of a financial cleanup, over time it will seem that things that used to seem out of reach will become affordable, and every unexpected expense won’t be catastrophic. By following these tips, you can tailor your future to your specific needs. Changes may be gradual, but by this time next year you’ll be able to toast to your financial well-being.