Financial Planning Resolutions for 2019
With every year, there is a new opportunity to make smart financial decisions. Why not make this new year exceptional by resolving to take steps to master just a few of the more common financial planning mistakes people make? Resolve to develop good financial habits this year with 2019 financial planning resolutions!
1. Write down your goals. It is so much easier to make your goals a reality if you can decide exactly what you want and when it will happen if you’ve written it out. Then make a list of everything you can think of doing to get you to that goal. Don’t just dream about it—take action. Do something every single day that moves you toward your major goal!
2. Build your Emergency Fund. If you don’t have an emergency fund established already, consider opening an online high yield savings account–the interest rates are looking good! You’ll want to build toward a 3- to 6-month reserve of living expenses, but don’t let that overwhelm you if you can’t fund it all at once. Get the emergency fund account open and start with a small amount. The important part is to make it a habit to contribute to your savings every month.
3. Create a pay-off plan for debts. First, stop digging the hole and avoid situations where you are perpetually accumulating debt. To start the pay-off plan, list all your debts and include the outstanding balance, the interest rate, the minimum payment amounts and how much extra monthly you can put toward paying off debt. Pick one debt to target eliminating at a time (for the others, keep paying the minimum amount to be in good standing). Once that first debt is retired, focus those extra payments on the next debt on your list and so on. It may require reducing your discretionary spending to make it happen, but consistently paying more than minimum payment every month will eventually get you debt free.
4. Contribute to your kid’s college fund. The key for college funding is to start saving early. By putting funds in a college savings vehicle like a 529 plan now or even before your child is born, you’ll have the benefit of time for the assets to grow and take advantage of compounding interest. Make part of your savings plan putting funds in the account every year or establishing automatic transfers every month.
5. Review your insurance policies. Insurance provides protection in the event that something disastrous happens to you or your family. Do you need additional coverage or could you be paying more than what you need? Make it an annual practice to read through your home, auto, life, umbrella, and disability policies and determine if anything needs changing. Hopefully you’ll never need to use the insurance, but you’ll be covered if you do.
6. Create your will. Many procrastinate creating a will, but it’s important to think about what is best for those who you’ll left behind. Make 2019 the year you’ll get one done! Creating a will allows you to name a guardian for your minor children as well as name who will receive your property. Review your will every year in case your situation changes. Don’t forget, you can always change or create a new last will and testament.