2021 is right around the corner.
If you're anything like me, you want to do everything in your power to make sure you start the new year on the right page following the chaos of this year.
Here are the top five ways to stay on top of your finances going into the new year.
1. Track Upcoming True Expenses
A 'True Expense' is a larger, less frequent expense that is independent of your recurring expenses. These can be anything from:
Annual gym fees
Annual credit card fees
Renewing your car registration or license
Filing for taxes
Make a list of any upcoming true expenses you may have so that you're on top of it going into next year. You can easily input all your true expenses in Tracker and set up notifications so you'll get alerted when they are due.
2. Find Ways to Cut Back
If 2020 has taught us anything, it's that nothing is certain. Things can change unexpectedly so it's important to start saving as soon as possible. Find ways to cut back on your expenses by analyzing where your money is going.
Compare gas/electricity/phone/insurance prices
When shopping, bring a list of the items that you need so you stay on track
Cook food at home instead of spending money on dining out
Be grateful for the money that you have and nurture it instead of giving it away
3. Set a Budget
A budget helps give every dollar that you have a purpose. It takes into account your income and divides it into separate spending categories. You don't need to be a math wizard in order to start. You can set up in under five minutes using our latest success tool, Budget.
The best part of the tool is that it will show you exactly how much you're able to spend per day. The more days you go without spending, the higher that amount will be.
Stay under budget each period to start saving money.
4. Stop Making Impulse Purchases
Unplanned purchases can cripple you financially and burden you with debt if you are not careful. It's always wise to consult your budget prior to making any purchases to see if you're able to.
If you're looking to make a large or unplanned purchase, make sure you answer these questions:
Can I afford it?
Is this a want or a need?
Will this hurt me financially?
Will this item be discounted a few months from now?
What else could I spend this money on?
Can I wait 24 hours to make the purchase?
Is there a return policy?
Do I actually need this?
After you ask yourself these questions, reconsider your purchase and determine if it's worth it.
5. Save Your Money
According to GOBankingRates' savings survey, nearly 70% of Americans have less than $1,000 saved. For most Americans, that's not even enough to cover one month of expenses.
2020 has been a crippling year for many individuals due to the pandemic. Regardless of what happens next year, it's important to have emergency savings.
If you're unemployed and looking for work, when you do find a job - it's going to take a few weeks until you get your first paycheck. Make sure to have enough money saved up to cover your expenses until that happens.
Don't forget the power of time and compounding.
If you saved $5 a day for a year, you would have $1,825 dollars saved up.
Here are some fun ways to save money:
Try to stay under budget each period
Set certain days where you don't spend any money at all
Round up your account balance at the end of each day and save the change
For more tips, Visit Money Matters.