If you want to whip your finances into shape this year, check out these five New Year’s resolutions. They identify specific tasks you can do throughout 2024 to improve your financial standings.
1. Exceed Your Minimum Payments
The minimum payment can come as a relief when money is tight. It’s significantly less than your outstanding balance, so it doesn’t take as much to keep late fees off your account. The only problem is that the minimum payment can become a crutch at times when you have money to spare.
Unfortunately, relying on the minimum has long-term consequences for your finances. It means you carry over a balance that accrues interest, increasing what you owe even if you don’t use your account. Your outstanding balance may also affect your credit score if your lender shares your credit utilization with the major credit bureaus.
The folks behind the FinTech platform MoneyKey recommend borrowers always exceed the minimum when their budget allows. This simple tip can help you reduce your interest, and you’ll pay off debt faster. You may even free up your line of credit so that it’s available in the next emergency.
2. Save Your First $1,000
New data shows about 40% of people have depleted all the savings they managed to stockpile during the 2020 lockdown. That means just under half of Americans don’t have a safety net of cash savings to help in an emergency.
Creating this safety net for yourself is one of the best ways you can supercharge your finances in the new year. But a quick Google of emergency funds can scare you off this goal. Most financial advisors recommend you save three to six months of living expenses. That’s a daunting target, especially if you’re starting from scratch or juggling other financial responsibilities.
So, forget about this benchmark entirely. Instead, focus on what you can do to save your first $1,000, and worry about the rest after you make a habit of saving. A grand may not cover a full month of expenses, but it can help you out the next time your car’s check engine light goes on.
If you want to save this in a year, you only have to save roughly $84 every month. According to Eventbrite, the average event-goer spends nearly that much on a single night out, and they do it twice a week! You can hit your $1,000 target in no time by simply limiting your nightlife.
Automating these savings makes it easy to stock your emergency fund. Your bank will transfer your contributions like clockwork, so you never forget this goal.
3. Be Wary of Your Monthly Subscriptions
If you’re like most people, the list of monthly subscriptions you pay grows each year. In 2024, you should flip this trend on its head, cutting your subscriptions in half.
According to a survey by C+R Research, the average person pays 12 subscriptions, spending about $219 every month. Some forget that they even have these subscriptions, as the payments come out of their account automatically.
One-too-many subscriptions can be silent killers of your budget, so take the time to review all the apps, memberships, and accounts you pay in a month. Look at your past financial statements to make sure you don’t overlook any of them.
Once you have a list, be honest about what you really want and don’t want. While you don’t have to go subscription-free, you should cut back significantly. Cancelling half of your subscriptions (or more) frees up more cash you can pour into your emergency fund. Alternatively, you can use this money to start investing in 2024.
4. Negotiate for Work from Home Privileges
All this talk about your budget, and so far, this article has only focused on the way you spend your money. Now it’s time to think about how you earn it. You need to be able to multitask money-saving techniques and income-earning tips to make major gains in the new year. You can start by advocating for yourself in the workplace.
Many employers expect a return to the office in the upcoming year — if not for the full week, at least a hybrid model. If your company joins in on these arrangements, don’t give up on your work-from-home privileges.
Working from home saves the average worker saves about $5,000 a year. That’s because you skip all the commuting costs and other in-person expenses of working at the office.
Set up a meeting with your boss. Anticipate your boss having reservations about letting you work remotely, so come prepared with stats on your contributions and productivity as a work-from-home employee. You’ll want to explain how staying home will save them money in the long run.
5. Research a New Career
Hiring experts say it’s always a good idea to be looking for new work. It’s a great way to keep a finger on the pulse of your industry, seeing the going rate for similar positions. You never know when you’ll find something that catches your eye.
2024 might be the best time to ramp up your search. Experts forecast the job markets will grow in the upcoming year, which means more positions will be available overall.
If your industry is a dead-end, start thinking about what you would have to do to switch fields. Consider what you want out of a job, and research growing industries, like the cybersecurity industry sector or healthcare fields.
You may also want to investigate side hustles you can integrate into your usual routine. You can monetize a skill or hobby online, or you can try your hand at digital money-making options like retail arbitrage or affiliate marketing.
Once you have something in mind, investigate what education you need to get your foot in the door. Spend the year refining your skills (in some cases, you can do this online for free) and volunteering to pick up experience. Eventually, you can update your resume with your new career in mind.
Improve Your Finances in the New Year
Once you commit to these goals, remember to celebrate the wins along the way. After all, establishing new habits and changing your finances isn’t always easy. Acknowledging your hard work can help you stay motivated all year long.
