4 Mini Money Resolutions for 2018
Are you in the 44 percent of people who will make a resolution to improve yourself or accomplish more this year? Maybe lose some weight, go back to school, or finally write that young adult novel? All great resolutions. But while we’re committing ourselves to working harder or getting more done, why not ask your money to do the same?
When it comes to New Year’s resolutions, achievability is the name of the game. So with that in mind, we reached out to financial expert Carla Dearing for her advice. Dearing is the founding CEO of SUM180 (@mysum180), an online financial wellness service that helps make financial planning both simple and affordable. Here are her suggestions for four achievable mini-money resolutions in 2018!
1. “Get a handle on your expenses.”
Money moves in two directions: In and out.
You work hard to earn an income, but we don’t get keep all the money we make. Everyone has expenses like needs (think food, clothes, rent, utility bills, etc.) and wants (eating out, expensive hobbies, vacations, etc.). And getting control of your expenses can be a very necessary goal.
Here’s Dearing advice for how to get it done: “Many of us have no idea what our expenses add up to every month. When you know where your money goes, you are in control and can be thoughtful about aligning spending with priorities. Use an online money tracking service, like Mint or Quicken, to see all your financial accounts in one place and even create your first budget. Doing this, you will always know where you stand financially. Mint, for example, gives you complete access to your data through the website and your mobile device, whether you use iOS or Android. Better yet, Mint keeps an eye on your money for you. It even sends alerts to remind you to pay your bills or when you go over budget.”
2. “Identify two or three regular monthly expenses you can do without—then delete them.“
Now that you’ve organized all your expenses, start cutting ’em!
Dearing advises, “For one person, the eliminated expense may be premium cable and a too-generous data plan. For another, it may be online shopping and extra spending on eating out. Be creative so you don’t feel deprived. If you love to eat out, challenge yourself to make delicious meals at home six nights a week. Your one restaurant meal per week will feel more special and you’ll save a ton of money.”
We couldn’t agree more. Separating your need expenses from your want expenses is one of the most effective ways to identify opportunities to save money. We feel so passionate about this that we dedicated a whole money lesson to it in OppU–our free personal finance curriculum. Check out this and all of the other videos, quizzes and resources at OppU (it’s free!).
3. “Tame your credit card debt.”
Americans have more outstanding credit card debt now than at any other time in history. So chances are, this resolution applies to all of us.
If your credit card debt feels like a mountain you can’t even imagine climbing, then make 2018 the year you do something about it.
Dearing recommends taking these active steps:
- “Contact your credit card company and ask if they will lower your annual percentage rate (APR) on the card. Many credit card issuers would rather lower your rate than have you transfer to another company. It’s worth asking.
- Use as much as 50 percent of your monthly savings to pay down your credit cards completely in the coming months.
- Watch for credit card offers you receive in the mail (for which you are pre-approved). Often, these offers include a low fee to transfer your balances and then a period of time with 0% interest. If you are able to transfer the balances from a higher cost card, you can pay that balance off much more quickly if it’s not accumulating interest. Be aware that the 0% interest rate does not apply to new spending.
- If you own a home and have accumulated some equity in it, consider whether a home equity line of credit (HELOC) is appropriate for you. The interest rate on a HELOC is often significantly lower than the interest rate on credit cards. By paying off the credit card and moving that balance to a HELOC, you’ve reduced the amount of interest that will stack up and will be able to pay off the debt more quickly as a result.”
We love talking credit and credit repair. Check out these other OppLoans posts that can help (and encourage) you to attack your credit challenges!
- How fixing your credit can fix your future.
- Dose your spouse have bad credit? Here’s how it can affect you.
- How bad credit can affect your kids’ future.
4. “Refinance your student loans.”
Okay, this one’s not so mini… If you’re one of the four in ten adults under 30 (or one in five between 30 and 44 years old) currently wrestling with student loan debt, consider making 2018 the year you resolve to refinance.
Dearing says, “Refinancing your loans is one of the best options to pay off your student loans faster and more cost-efficiently. When you refinance your student loans, you’ll have one consolidated loan with a single monthly payment and a lower interest rate, which is important as more of each payment goes toward paying down the balanced owed.
- If you decide to take this path, the first step is to find a reputable bank you’re comfortable working with and see what they can offer (ask friends and family for banks they do business with).
- It’s smart to compare interest rates to see if you can lower yours. Just remember, extending the term, while it lowers your payments, will result in paying more interest over time.
- Be sure to steer clear of companies charging high upfront fees to help you consolidate your student loans or that claim to be ‘approved’ or ‘exclusive’ servicers to ‘special programs’.”
For more on student loan refinancing, FAQs and–gasp–even forgiveness, check out our other posts:
- Live in one of these 20 states? Falling behind on student loans could mean losing your job.
- The OppLoans Guide to Consolidating Student Loan Debt
- Student Loan Forgiveness
What are your other money resolutions for 2018? We want to know! It could pay off! Check out the 2018 OppLoans #Money #Resolution Sweepstakes and enter to win $100!
|Carla Dearing, a Wall Street veteran, is the CEO of SUM180 (@mysum180), an online financial wellness service designed to be simple and affordable. Carla is also CEO of Vibrant Nation, the leading online community of women 35+, and CEO and Managing Director of IMC, a Louisville, Kentucky-based marketing services agency.|