One of the most common New Year’s resolutions year after year is to better manage finances and become more financially stable. Yet, when dealing with post-holiday bills and everyday expenses, that’s easier said than done. Whether you’ve got a rainy day fund stashed away or have yet to save a dime, the tips below can steer you toward financial security this year and beyond.
1. Look into savings options.
Stashing money underneath your mattress isn’t a long-term plan; if you don’t yet have a savings account through an established bank, consider looking into opening one. Although nothing is 100% foolproof, it can be more secure than keeping money at home since most banks are insured by the Federal Deposit Insurance Corporation (FDIC). Another plus: many banks offer incentives and rewards for allocating funds to a certain type of savings account including interest accrual.
Just be sure to do your homework regarding the benefits and drawbacks of different types of savings accounts before signing anything. Then, once you’ve established a savings account, dedicate a certain portion of your income every month directly to it. Soon enough you won’t even miss that 10 or 15% redirecting from your checking account to savings.
2. Utilize coupons and reward programs.
Thanks to technology, it’s become easier than ever to take advantage of deals and coupons! There are several smartphone apps such as The Coupons App and Cellfire that help gather coupons for the stores or products you’re interested in. In addition, most markets and even some restaurants and apparel stores offer free reward programs that offer deals or incentives in exchange for allowing them to track your purchases so they can analyze consumer trends.
3. Open a Roth IRA.
A Roth Individual Retirement Account (Roth IRA) can help you plan for the distant or not-so-distant future. Also, with a Roth IRA, you pay taxes on the contributions you put into the account so you can tap into those funds when needed for expenses like continuing education without getting hit with a massive bill.
4. Live within your means.
What’s the easiest way to limit or lower debt and increase spending power? Reduce your expenses. Living outside of your means can quickly turn into crippling debt, and then you’re stuck in a vicious cycle of working to pay back the continuously accruing interest on those credit cards you never should have used. Take a long, hard look at your weekly and monthly budget to determine the areas of wiggle room. Could you cook at home instead of eating out? Have you ever shopped around for new car insurance? Can you find your favorite TV show online and get rid of the cable bill? What about carpooling to work, which cuts down your gas and vehicle maintenance expenses? Don’t be afraid to get creative!