The new year is here, and that means it’s Resolution time. While you might be planning to drop 10 kgs or finally land your dream job, you should consider making some financial resolutions, too.
In fact, according to a survey, more than one-third of Indians made a Money resolution last New Year. Unfortunately, even solid resolutions fall by the wayside come springtime.
“Most people fail to keep their resolutions because they don’t create an action plan to achieve their goals and fall back into old habits”. “In the case of financial resolutions, the best plans are focused on forming new money habits.”
With that in mind, here are five financial resolutions to make in 2018 and how to keep them.
1. Contribute to your retirement
According to a new survey, a whopping 69 percent of millennials are not saving for retirement. While it’s difficult to set aside more money in addition to costs such as student loan repayment, putting even a little bit aside for retirement now can help big time in the long run.
“The more you save early, the more you will have, and by a lot”
The new year is a good time to enroll in a retirement plan at your job. “Establish a retirement account early, and consistently contribute money to it”. “You can easily do this by having an automatic deduction monthly from your bank account that goes to your retirement account.”
2. Get your student loans under control
Want to make 2018 the year you get serious about paying off your student debt? There are a number of ways to do it.
Student loans should be organized based off of interest rates. “Make it a priority to pay off the higher-cost debt first to limit the interest paid over time,” he said. This strategy is known as the ”debt avalanche” and it one of the most popular tactics for saving money on your loans.
monthly payment, consider an income-driven repayment program based on what you can afford. Or, if you need a lower interest rate, look into refinancing your loans.
3. Automate your savings
Saving money is a time-tested way to shore up your financial security. Unfortunately, almost half of Indians admitted they wouldn’t be able to find Rs 5000 in an emergency, according to a study.
Saving for a rainy day seems difficult if you have a lot of expenses on your plate already, but luckily, saving even a few dollars here and there can help in a big way. “Even if you only save Rs 300 every two weeks, you’ll have Rs 8000 to show for it at the end of the year”. “To make it easy, work with your employer to authorize a direct deposit to your savings account.“
4. Create a budget (and follow it religiously)
Whether you want to save more money or pay down your student debt faster, coming up with a budget is the best place to start.
“For the new year, take a list of what will matter to you over the next one year, five years, and 10 years,” From there, you can better understand what you can do now to make those goals happen.”
Once you know your goals, begin to make your budget by closely tracking all of your income and expenses. From there, you could try a variety of strategies such as automating your monthly bill payments or paying for everything in cash. Sharing those goals with others also helps psychologically with keeping them and providing a level of accountability.
To make this new budget stick, sit down once a month and budget your income and expenses. “Do this at the beginning of every month, and it will quickly become a habit and will make a great difference in your finances,”
5. Make more money
While you are working hard to pay off your loans and take care of your expenses, sometimes your day-to-day job just doesn’t cover it all. Taking on a side hustle is a great way to earn some extra cash — even better, you can work many gigs around your schedule.
Ridhi holds down a full-time job, but drives for Uber on her off hours and can make Rs 25000 in one weekend alone. Sachin, meanwhile, makes deliveries for Swiggy on his lunch break and after work to pull in an extra Rs 1000 to 5000 a week. Or try one of these easy money-making ideas, such as dog walking or teaching English online.
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