Each new year is an opportunity to create routines that will help carry you toward your financial goals.
Setting new habits can help you take charge of your overall financial strategy.
With the right tools in place, you can make this year your best financial year yet.
When it comes to reaching your financial goals (like any other goal), it’s all about finding a routine and sticking to it. Make this your year to solidify the habits and tools that’ll help you stay on course.
Together, these methods can help you cut expenses, save for the future, and increase your income:
1) Automate
These days, online and mobile banking are no longer add-ons — they’re the main attraction. Numerous apps (most of them free) are designed to make saving, budgeting, and bill paying intuitive and automatic. If you haven’t already, it’s probably time to get on board.
For most of us, it’s easier to make a few good financial decisions upfront than to make lots of good financial decisions day in and day out. Humans aren’t typically that disciplined.
Think how easy it is to invent an excuse when choosing whether to put part of your paycheck into savings each month. Sure, there are times you choose to save, but there are probably just as many chances to reduce the amount you’re saving, or put it off entirely. There will always be attractive opportunities to spend rather than save. But automating your savings can set you up for success by closing the door on future decisions to save less and spend more.
With your bank’s online tools, you can enable automatic payments to your savings account, automatic bill pay to your credit card(s) and your service providers (phone, internet, mortgage, etc.).
And apps go even further. The popular budgeting app, Mint, can combine your bank accounts, credit cards, and bills in one place, allowing you to track your money in real time, transfer money between accounts, pay bills, and create budgets.
Another app, You Need A Budget (YNAB), is designed to help stop people from living paycheck to paycheck, only allowing them to create budgets with money they actually have. According to YNAB, on average, new budgeters save $600 in their first two months and more than $6,000 their first year.1
Finally, one of the most important methods of automating your way toward your financial goals is by maximizing your employee benefits. By enrolling in your employer’s 401(k) or other retirement plan, you’re making one financial decision that essentially automates over and over throughout your career, helping you toward your financial goals.
2) Take advantage of credit card rewards
Whether your credit card offers cash back, airline miles, or rewards to your favorite stores, you can make your spending work for you by using your credit card intelligently. Meanwhile, you’ll be establishing a credit history that can help you buy big, important things, like a car or house.
Of course, you have to be careful to spend only what you’ve budgeted and can cover. It helps to think of your credit card in the same way you do your debit card. The dollar amount in your checking account is what you have available to spend, not your credit limit.
Exercise caution. Taking advantage of credit card perks depends on your ability to pay off the balance every month. Unless you have a 0% APR card (and that perk is only available to a cardholder for a limited time), each month you pay interest to the credit card company based on the balance.
If you only pay the minimum but continue using the card, you’re growing the amount you owe in interest. Additionally, paying your balance in full helps keep your credit utilization ratio in check, an important factor for your credit score.
3) Stop paying full price
When trying to reach your financial goals, it’s easier to cut spending by limiting superfluous purchases. It’s a little harder to cut spending on necessities. Luckily, there are apps out there to make sure you’re getting the best deal.
RetailMeNot gives you access to coupons, product deals, storewide sales, discounted gift cards, and digital rebates to over 50,000 stores.
Key Ring is an app that stores your loyalty and membership cards on your phone so you’re never without a discount. It also lets you search for sales and coupons, create shopping lists, and search for deals across local circulars and coupons.
PriceBlink is a browser add-on that combs the web while you’re online shopping and shows you the best available price for any given item.
4) Look for alternatives to buying new
Getting a good price on an item is important. But do you even need to buy it new from the store? There are money-saving alternatives to traditional buying.
Public libraries offer more than books. They provide audio books, movies, and music, a variety of newspapers and magazines, access to the internet, online language-learning software, online career-training software, and small-business help — all free. The Denver Public Library offers free passes to Colorado’s 42 State Parks, Go-Pro cameras, museum and cultural facility passes, and wireless hotspots. What does your library offer?
Certain items like specialty tools and appliances you use infrequently can make more sense to rent. There are online tool libraries in many communities that provide tool lending and training.
You never know what you’ll find in a good thrift store or online on eBay or Craigslist. And you can make use of sites such as Freecycle: a non-profit hub that lets members give and get free stuff within their communities.
5) Eat healthy
Perhaps nothing illustrates the synergistic connection between your physical health and your financial wealth better than your diet. One of the CDC’s recommendations for decreasing the likelihood of getting a chronic disease is eating healthy.2
So what does “eating healthy” mean? A healthy diet tends to emphasize nutritious whole foods, such as fruits, vegetables, whole grains, lean meats, and low-fat dairy products.2 Upping your fruit and vegetable intake may help protect you from cancer and support your immune system. It can also help you achieve and maintain a healthy weight.3
6) Find a financial friend
Trying to reach your financial goals all by yourself can be challenging. Without a trusted person in your corner, you might have a hard time sticking to habits or end up being unrealistic when reviewing your spending habits.
Working toward financial goals requires discipline. The challenge might be easier when you have a friend, significant other, parent, or financial professional to provide support. An unbiased second or third party is less likely to be as sympathetic when your financial choices get a little careless. At the very least, having a planning partner increases your level of intention by forcing you to schedule dedicated time to work on your wallet.
7) Budget your fitness routine
Exercising regularly can help keep medical issues, and the bills that come with them, at bay. While gym memberships can get expensive, they can be a good investment in your physical and mental health. There are also less costly ways to get your exercise in to meet your health goals without throwing a wrench in your financial ones:
Use Meetup.com to find free workout groups or to play drop-in sports
Buy used exercise equipment or home fitness devices
Share at-home fitness subscription costs; some offer unlimited access for multiple members
Use your computer to find free online workouts on YouTube or low-rate subscription video streaming memberships
Only purchase gym memberships during mid-year or year-end sales; you can also keep an eye out for end-of-the-month offers
Take advantage of free trial periods at gyms and studios
Shop sites like Groupon.com to find deals on local workout classes
Head outside and take walks or bike rides in your neighborhood or the local park
8) Get organized, have a plan
Debts and expenses aren’t the only thing that can disrupt financial goals. Sometimes there’s just too much information. New technologies may have made it easier to track finances, but anyone is still capable of misusing all those apps and products until they’re lost in a sea of pixels and forgotten passwords.
Making good financial decisions depends on having a clear picture of your situation and not getting lost in the shuffle. If trying to manage it all yourself is too overwhelming or time consuming, consider working with a financial professional. They can help you look at everything you have, set goals, and work toward creating the financial picture you want.
Things to Consider:
Financial tools are most effective when they become lifelong habits.
Start small with one or two things you know you can accomplish during a lunch break or before bed. You can always build from there.
Share these tools with friends and see what you can learn from others on the path to financial wellness.
Transamerica doesn’t endorse services or tools listed above.
Transamerica Resources, Inc. is an Aegon company and is affiliated with various companies which include, but are not limited to, insurance companies and broker dealers. Transamerica Resources, Inc. does not offer insurance products or securities. The information provided is for educational purposes only and should not be construed as insurance, securities, ERISA, tax, investment, legal, medical or financial advice or guidance. Please consult your personal independent professionals for answers to your specific questions.
1 You Need A Budget, accessed March 2022 2 “How You Can Prevent Chronic Diseases,” Center for Disease Control and Prevention, April 2021 3 “Benefits of Healthy Eating,” Center for Disease Control and Prevention, May 2021
