There is no better time to set financial goals so you can save money and get what you want. Take a look at five things to work towards in 2021.
The start of the new year is always a time for resolutions and fresh financial goals, but all too often the promises you make don’t last past January. This usually happens because of a lack of clarity, planning and well-defined goals.
This new year, take a strategic approach to make positive, lasting change. Here are five smaller goals that will get you started as you work towards a secure financial future:
Financial goal #1
Set a budget
The key to making your finance work is to have more dollars coming in than are going out. If you only have one financial goal and strategy to stick to, it should be this one.
Your first financial new year resolution is to set a budget. By keeping track of all your expenses, as well as your income, you will know exactly how much you can spend when and on what, as well as how much you can put aside for a rainy day.
Don’t be daunted by setting a budget! Here’s our guide to budgeting like a ninja.
Financial goal #2
Consolidate your debts
Once you have your incomings and outgoings on track, it is a good time to consolidate your debts.
Taking control of your debt is a great financial resolution to have. It is all too easy to lose track of your finances if you have loans to different banks and lenders.
Find a reliable lender and talk to them about rolling all your debts into one. This way you won’t be dealing with multiple payments to different lenders. You may also be able to negotiate a lower interest rate, which will give you more spending money or allow you to pay off your debts sooner.
Financial goal #3
Fix your credit history
Pretty much everyone needs a substantial loan at some point in their life, but if you don’t have a good credit history you’ll find it hard to access money when you need to.
You can request your credit history online at any number of sites including www.wisrcredit.com.au and creditsavvy.com.au. You may be surprised to find you have a couple of unpaid bills you didn’t know about. These are ‘black marks’ against you and can affect your borrowing power.
Once you have checked your credit history and taken the steps to resolve it, always pay your bills on time going forward. Keep your debts to a minimum and you’ll be better placed to take on a major responsibility like a home loan when the time comes.
Financial goal #4
Make a bigger goal
You have completed your smaller goals like taking control of debt, making a budget and clearing your credit history.
Now give yourself something exciting to work towards. It may be a home loan, a break from work for a few months or a qualification that will help your career.
Establish a series of short term savings goals that will bring you closer to your long term goal. Having something exciting in mind will inspire you to stick to your resolutions.
Financial goal #5
Set yourself up for the long term
Since you are being good and setting your financial resolutions, why not also put the wheels in place for some even longer term financial goals?
There are a lot of options these days to set yourself up for the future and it pays (pun intended) to do your research. Many finance gurus talk about investing in the stock market or real estate and both can be great options. The ultimate goal is to be able to step away from work but still be generating an income to live comfortably on.
Now you are in control of your income versus your outgoings, you will know what you can set aside to invest and can find the best options for you.
Disclaimer: The information above is of a general nature only and does not consider your personal objectives, financial situation or particular needs. You should consider seeking independent legal, financial, taxation or other advice to check how the information relates to your particular circumstances. We do not accept responsibility for any loss arising from the use of, or reliance on, the information.