I’m fully aware that the New Year is still more than a month away. I’m also a firm believer in planning ahead. And at this time of the year doing some financial check-ups is crucial.
I’ve got some big plans for 2015. In fact, 2015 is going to be EPIC!
Since I set goals on a monthly basis and already have my big picture in mind now, I’m more focused on making sure that I finish 2014 off on the right foot so that everything is smooth sailing once January rolls around.
Here are three things you can (and should) do now to financially prepare for the New Year.
Review All Your Financials
You should review all of your financial information right now. Why? Because not only is the New Year right around the corner but this is Christmas shopping season! The last thing I want you to do is going into debt buying Christmas gifts to set a goal to pay that debt off ten days later.
That is nothing more than self-sabotage – but we’ll get to that in a minute.
Here are some things you should go over.
Budget – When is the last time you updated your budget? I did this at the end of October and its crazy how much my expense categories have changed since last year. Updating your budget and dare I say, tracking your expenses, will show you where your money is now going.
I know, I know tracking your expenses is a total pain. I’ll be honest, I hate doing it. But I’ve done it through November anyway just so I can be aware of what I’m spending too much money on. After all, I’ve got some pretty audacious goals I want to achieve and I’m guessing that you do as well!
Retirement – There’s still plenty of time left for you to sock some more money into your retirement account if you can afford to do so. It might be a really good idea to put more money in a tax advantaged account like a 401k or traditional IRA if you plan on owing a lot in income taxes.
Debt – If you have any type of consumer debt or student loans let’s get it in order. Make a spreadsheet listing all of your debts from smallest to largest so you know what you’re working with. If you don’t already have a debt pay off plan in place you can try the debt snowball method or the debt avalanche.
And if you’ve been steadily paying off your debt but haven’t tallied up all the balances in a while, now is the perfect time to see what kind of dent you’ve made and celebrate your progress. Hopefully seeing those numbers will give you a boost of motivation!
Cover Christmas with ONLY Cash
Please don’t go into debt over Christmas. Pretty please? I’m begging you.
The whole reason we have Christmas is to celebrate the birth of Christ. I can’t remember where I heard this from or I’d link to it, but this quote really made me think – “We’ve turned Christmas into the most materialistic holiday to celebrate the least materialistic man who ever walked this Earth.” Ironic, right?
I’m not saying don’t buy anything for anyone, but to work with the money you have. Be creative with your gifts. If you can’t afford to give gifts then you can’t afford it. There is no shame everyone will forget in a couple weeks anyway.
I personally try to make my money stretch as far as possible. In addition to finding unique ways to fund Christmas I also like to find great deals. I personally check Hip2Save about every other day to see if there are any good deals on items on my list.
Set a budget. Make a list. Be creative. Avoid debt at all costs.
Create Goals Now
Once you’ve gotten your financials in order and have a clear picture of where you’re at you can map out where you want to go.
I normally don’t set New Year’s Resolutions. In fact, last year was the first time I have done it in years and I miserably failed at every single resolution I set. Luckily, I reassessed and set my goals on a monthly basis.
Did you know that only eight percent of people who set resolutions actually achieve them? Crazy, huh?
I personally feel like if you care about improving your life you wouldn’t wait until January to set goals. You’d do it now. Today.
Map out where you want to go and make a plan to get there. Then start acting on your plan. Don’t wait until January.
Don’t intentionally take two steps backward so that you can take one step forward in the New Year. It doesn’t matter if your goal is to get out of debt, lose weight, or anything else. If you wait until January to work on that goal you’ll only be self-sabotaging yourself!
Make 2015 Count!
If you want to make 2015 count don’t wait until January to get started. Start working through everything that needs to be done and go for your goals. This way when January rolls around you’ll already be one step ahead of the game.
Do you wait until January to set goals? Do you ever accomplish your New Year’s Resolutions?