January is coming to an end but there is always time to get interesting financial advice for the current year. So on the subject of finances, adopt good habits money in January it can bear fruit already in December.
The issuer CNBC Make It spoke to a group of financial planners to get their best money tips for the new year.
Start by analyzing the balance sheet of the previous year
Every good financial plan starts with a budget, and analyzing your 2021 spending can help you create smart New Year goals.
“You can look at the past year and see what you’ve done and what you’re happy with,” says Kasia Marczyk, president of West Palm Beach. “Looking back helps you understand what you really want to spend in the future”.
Part of this analysis should also include spending errors. Dennis Morton, co-founder of Allentown, also claims to “look back over the past 12 months and ask, ‘What have I learned? Indicate a couple of wins to acknowledge that you are capable of doing one positive change, and then turn around and say, ‘Now, what small steps can I take towards the bigger goals?’ “
Once you have built your new budget for the year, consider review it once a month – especially if you are a beginner says Marczyk. In this way, you can continuously make sure that everything stays on the right track and, if necessary, make adjustments in real time.
Write down your specific financial goals
If you don’t write down your goals, you’ll have a harder time achieving them. This applies to the short-term goals, how to save to buy a car or a house, and for long-term ones how to build one nest egg for retirement. And it’s especially important for couples, where financial communication is key.
“If it’s all in your head, you can be confused when you start talking about big decisions,” Morton says. “I think putting it on paper makes it easier to communicate when there is more than one person involved in financial decision making.”
According to Laurie Allen, a CFP at LA Wealth Management in Long Beach, le couples they should intentionally brainstorm their financial goals together.
“If you’re married, sit down with your spouse and write down what you want to accomplish,” she says. “So that you can tell your money what to do during the year, instead of your money telling you what to do for the whole year.”
Build a savings or investment habit
Often times, the biggest obstacle to achieving a financial goal it’s simple: people don’t give them the right priority. The advice in this case when you receive your paycheck is to dedicate a part of your salary to savings. The same concept applies to any year-end raise or bonus you receive – that extra money can help boost your savings and investments.
Invest in your financial literacy
Another consultant often advises his clients to make a focused effort to learn about money – even if they are not interested in financial issues – in order to then take informed financial decisions for the rest of their life.
“Pretend your new favorite hobby is finance and learning about money and investing”, “Find your guru. Maybe it’s some influencer on TikTok who is really good at saving money. Maybe it’s a magazine or a book ”.
Start doing something immediately
Excuses are often found saying that it is not the right time to to save money or invest. Bear market or personal problems, whatever the excuse is good to get rid of, says Morton.
“The thing that is sometimes so frustrating to hear is when people think there is a good time to start.” “It reminds me of that proverb: the best time to plant a tree was last year, and the next best time is now.”