With the first few weeks of 2013 coming to a close, you may feel more inspired than ever to tackle your list of resolutions.
If you’re like many of us, you likely have made a resolution that’s somehow tied to finances. Perhaps you want to pay off some debts, cut your dining out budget or begin to sock away a retirement nest egg. While these are all fantastic goals to achieve, the reality is that most people focus on setting their resolutions but fail to plan for what’s needed to successfully attain the goals.
Before you attempt to ride your current wave of motivation all the way to the bank, make sure you’re setting yourself up for success by having the proper pieces in place prior to launching your efforts into the stratosphere.
The Devil’s in the Details
Let’s say one of your resolutions is to pay off $2,000 of credit card debt. While it’s tempting to immediately resolve to paying off the entire amount within the year, what about breaking down the total amount into small, manageable pieces—say $167.67/month? (these numbers are hypothetical figures for illustration purposes)
Assigning your goal a concrete figure makes it much easier to reach it because now you have a plan as opposed to a vague, loose idea about what you want to achieve before the year’s end.
Don’t Forget the Budget
Once you have your monthly payment identified, what about how said payment will fit into your budget? Make sure to give your budget a detailed review in order to identify how you’ll fit in this new financial goal as well as how doing so will impact other financial obligations you may have.
[Free Resource: Check your free credit report and score]
While you’re reviewing your budget, be certain to identify ways you can reduce other expenses or, alternately, figure out some ways to bring in additional income. With a bit of creativity, you can find a way to fit your goals into your budget in a realistic, sustainable manner.
Timing is Everything
Now that you’ve identified your debt payoff goal and made sure it fits into your budget, you should set a timeline for accomplishing the goal. Why set a timeline when you have already figured out a monthly payment that works for your situation?
The answer is simple: Timelines are a tangible, adjustable tool that will help you stay on track throughout the entire year. If your financial situation changes, the timeline can change as well. And when you’re finding your motivation may be waning, a brief glance at your timeline can be the saving grace to get yourself back on track.
By taking these few extra steps to fully prepare and plan for the execution of the resolutions you’ve set, you will be that much closer to ending 2013 with your list checked off. Best of luck reaching your goals this year!
New Year, New Budget? was originally featured on Quizzle Wire
Quizzle.com is the easiest way to get a complete understanding of your credit. Visit Quizzle.com to get your free credit report and score. No credit card or social security number necessary!