Three steps to make 2015 your best financial year EVER
It’s 80 days into the month, how are your New Year’s Resolutions doing?
I find that no matter what kinds of goals I make to myself in January – financial, fitness or otherwise – the months I do the worst is inevitably February and March. But the best part of the spring is that it’s a season of renewal and a time to really double down and get shit done. Make this year your best financial year by committing to a few key goals.
1. Start saving
Seriously, it sounds so simple but it’s one of the most important things you can do to get started. It takes about five minutes to set up an automatic deduction from your chequing account to your savings account each month. Try to time it to when your payroll comes in (if you have a regular deposit) or make it a regular habit to transfer a set amount to savings each time you deposit a cheque. I use Tangerine Bank for my RRSP & Vacation savings, and both of these withdrawals are automatic two days after my payroll comes in. It gives me time to suspend payment JUST IN CASE something happens (never has) and it’s painless! It’s like the money never existed in my account in the first place.
Plus? If you use my Tangerine Orange Key 39814304S1, when you open up your own savings account we’ll both get a $50 Bonus! Visit tangerine.ca/referafriend and get started! Reciprocal programs are really the best.
2. Get serious about your debt
No debt? Skip to 2b.
I know, I know, I sound like a broken record, but think about it this way. Tally up your reasons as to why you’re not paying down your debt. ‘I don’t want to miss out on what everybody else is doing. I want what everybody else has. If they can do it, I can do it too, I deserve it’ These are common excuses people make about not taking their debt seriously. And to that I say – Why are other people’s lives more important than your own?
By stretching out your payment for your past (yes, you’re paying for your PAST) you’re sacrificing the here and now. Sacrifice is a word people don’t want to hear when it comes to debt repayment because it brings up images of people living in a minimalist yurt making their own soap. But you can sacrifice a little bit of comfort now to pay off your past, or you can sacrifice a lot from your future… to still pay for your past. Figure out how much you owe, how much you can spend a month and go from there. Nobody is stopping you except you. And pay more than the minimum, PLEASE.
As you can tell, this isn’t a step-by-step guide for getting out of debt, I’ve already written that post, this is more of a kick in the pants.
2b. Debt-free? Set up an emergency fund, stat!
When you’re in your early twenties, an emergency fund is crucial to pay for those small emergencies, the exorbitant cellphone bill, the vet trip for your cat, having to replace something expensive unexpectedly. But when you become more established, it can mean something all the greater. With more income generally comes more expenses, and when you’re let go at 22, you’re not left holding the same kind of expenses you might at 29 or 34. In the last 12 months I’ve seen more than a handful of my friends experience job-related emergencies and changes, and I saw the difference between those who had a fund prepared to help them out and those who didn’t. I don’t follow any prescribed mantra for an emergency fund, whether it’s three-months of living expenses, or a set number of dollars, just know that you have something that can support you when you’ll need it the most. As Scar said…
3. Plan for the future
I know a lot of people who have everything above figured out. They’re out of debt, they save, they have an emergency fund and they seem to be on the right track. They may even be, vaguely, saving for the future. But this point isn’t necessarily tied to the financial. This means you need to figure out exactly what it is you WANT to achieve in the near future, and how you’ll have the abilityto do so. You want a big Euro trip? Research the amount of money it’ll take to fly overseas, to commute from location to location, and how much you’ll need for accommodations. You want to start saving for a home? Do some digging on MLS.ca, or other real estate. You want to switch careers? Take some classes, do some work and re-skill yourself. Saving for the future isn’t as hard as it seems, sometimes PLANNING is the much harder thing you can do. Me? This is my big sticking point this year.
The reason I started this blog was to find myself an outlet to keep myself on-track and accountable with my goals. If nobody else KNOWS what I’m trying to achieve, the only person I fail is myself, and unfortunately, a lot of us seem to be ok cheating ourselves if it means we don’t have to disappoint others. In a way, keeping yourself on track is the best way to be YOUR best self. Your money should work for you and yours before it goes to other people.
Put yourself and your future first. Stop paying off your past and start setting up your future.
It’s 2015, make it your best financial year ever. Make it count. The world is your burger.
Header Image Credit: The Daily English Show