A new year is upon us which brings the gift of new beginnings, goals, and resolutions. It is the time of year when individuals reflect on the previous year and determine what specific goals and resolutions each wants to achieve in 2019. With each new year we strive to make this year better than the last. As mentioned in last month’s article, the top two resolutions and goals each year include: 1) Living a healthier lifestyle by eating well and exercising more and 2) improving financially by getting out of debt and saving for the future.
This month we are going to kick off 2019 with a goal to “Get Your Financial House in Order”! For many, reviewing finances can be overwhelming and can leave you feeling like you are the only one not on the right financial track. I am here to tell you, you are not alone.
The National Retail Foundation expected retail sales in November and December to total between $717 to $720 billion in 2018! That retail sales figure, along with the outstanding credit card debt figure, have been rising consistently since 2009 when our economy suffered the greatest financial crisis since the Great Depression. Since the financial crisis, revolving debt has exceeded the all-time high set in 2008 and is now in excess of $1.023 trillion. An online survey by Nerdwallet found that almost 73% of respondents said the bulk of their holiday spending would be on credit card and found that over 39 million Americans haven’t yet paid off their holiday bills from 2017.
That said, it is no wonder that improving financially is one of the top resolutions. Millions have turned to credit cards to pay to deck the halls, make their list and check it twice, and ring in the new year in Rockstar style. Consumers nationwide are suffering from a holiday spending hangover that can’t magically go away with a dose of Alka-Seltzer.
Although it was the most wonderful time of the year, and everyone deserves to enjoy the holidays, the credit card statements are starting to arrive in the mail (or inbox) and Americans are going to need a little bit more than a little “plop, plop, fizz, fizz” to take this headache away. Having a solid plan in place is the only common cure that will start the year off with a financial bang!
As you ponder ideas of what you really want to achieve in 2019, make your financial goals a top priority. Start by gathering each and every statement that arrives in the mail (or in your inbox) and face your current financial facts. When each statement arrives, whether it is a credit card or student loan statement, take the time to review the statement in detail, document the findings, and set financial goals. Here are a few steps to get you started on the right path:
Step 1 – Review Each Statement– As statements arrive in mail, don’t just tear off the coupon with the amount due and shred the evidence. Grab your highlighter, take the time to review each statement, and highlight the following findings:
-Creditor/Loan (e.g., Macy’s, Visa, Target, Nordstrom, etc.)
-Minimum Payment Due
Step 2 – Document the Findings– Once you have highlighted the above items for credit cards/loans, document each on one page using the following chart:
|Card / Loan||Balance||Interest Rate%||Min. Payment||Actual Payment|
Step 3 – Face the Facts– Total and review the amount that you owe on all credit cards/loans and make a commitment to pay all, or a portion of, the debt in 2019. For example, if you owe a total of $10,000 in credit cards, write down an amount you want to pay off in 2019.
Step 4 – Breakdown the Goal– Once you have determined the payoff amount, take the amount, divide by 12 and set your monthly goal. For example, if the goal is to payoff $5,000 in 2019. Take the $5,000, divide by 12, and set a goal to payoff $416 per month. Breaking the goal down into monthly bite size chunks will give you monthly results that will help build the momentum needed to achieve the annual goal.
The hardest step is always the first step. Take that step today and use the above steps to make 2019 your best financial year yet! By getting your financial house in order in January, all of your other goals will fall into place.
For these and many more financial ideas, be sure to visit my website www.jodeebrydges.com and pick up a copy of my new book “Digging Out”, which is full of practical advice to help you obtain your financial goals in 2019! Wishing you a new year filled with a wealth of financial success!