Many people make resolutions each year to get organized, eat healthy or exercise more. While those are all great pursuits, it’s also important to get your finances in order and work towards the goal of achieving more positive results where your money and lifestyle is concerned. More and more Canadians are getting deeper into debt, which can naturally cause a lot of headaches and keep people up at night worrying. Why not make a resolution to reach your financial goals in 2020 and breathe a little easier?! Here are 6 ways to get started:
1. Check your credit score
Do you know your credit score? It’s important to know where you’re at, as well as to check to see that it doesn’t have errors. Be sure to request a free copy of your credit report (it takes a bit longer but saves money) and then review it carefully. If you find errors, you can dispute them. Further, if you don’t already have a credit card, get one and pay it off in full each and every month. This will help improve your credit rating.
2. Get organized
Invest a few dollars and a few hours to sort and file your financial paperwork. A carefully labeled filing system will help you keep on top of those bills, receipts, bank statements, notices and so on. There’s nothing worse than spending hours looking for a single piece of paper. You’ll be able to budget and track your spending when all your information is in one place.
3. Pay down debt
You may be paying more in interest than you realize. Keep that money in your pocket by making a plan to pay down debt. Start with the debt that has the highest interest rates, such as credit cards or private loans, but continue to pay at least the minimum payments on all other debt. If you can, maintaining minimum payments on your other accounts while doing this is very important. You may want to look into consolidating your debt into one, lower interest loan and simplify everything into one payment.
4. Make a budget and stick to it
Do you know where your money goes each month? The devil is in the details! Track your spending for a month; you may be shocked to see that all those little expenses end up taking a large chunk out of your account when they are all added up. Some of the top culprits are TV streaming services, cell phone/internet/data plans, food delivery, subscriptions, memberships, app downloads, and coffee/meals out. Making cuts and keeping only the essentials will pay off substantially and help you reach those financial goals quickly. Tell your friends and family that you are on a mission to spend less so they don’t tempt you with big-budget plans. Don’t forget to watch for sales and shop smarter to help you stick to your budget too.
5. Invest in your future
Pay yourself first. Make automated payments each month on payday – you won’t even notice it over time. Even if you put $50 from each pay into your RRSP, TFSA or other savings plan, it will make a difference in the long run. Your money needs time to grow, so lock it in and let it do its thing over the long term.
6. Stop renting
Rents in our region are quite high, but home prices are significantly lower than areas such as Toronto and the GTA. Buying a smaller home, condo or townhouse may end up costing you less each month than renting, depending on your family income and current debt load. Talk to a professional mortgage expert to see where you’re at and find out if completing a mortgage application at this time is a good idea. Owning a home is an achievable goal, but it takes a bit of planning and preparation.
The best part about making a financial plan and sticking to it is that you’ll see instant results! Every dollar saved makes a difference. If you’d like to get a thorough look at your current financial standing, pay down debt, or talk about getting a mortgage, don’t hesitate to give me a call at 705-315-0516. I’m here to help you in any way I can so you can reach those financial goals in 2020.