As 2018 draws to an end, you may find yourself wondering how you accumulated so much credit card debt or why your savings haven’t increased like you expected. Well, most likely you either aren’t committed to your financial plan or you don’t have one at all. Eastex Credit Union is here with some must-know savings tips for 2019 to get your year off on the right financial foot!
Creating and sticking to a budget isn’t exactly at the top of everyone’s fun list but it is an important and very necessary part of life, especially if you want to retire one day. So, we created this list of some easy to follow tips to help you get (and stay!) on the right track in 2019.
Write Out Your Budget Every Month
Budgeting is the number one most important thing you can do to be financially responsible. You don’t have to make a lot of money to be rich- you just have to watch what you spend and manage your money well. The key to doing this is to make a plan of what you will spend based on your monthly income and then commit to it.
Write Down What You Spend
Whether it’s a $4 coffee or the $100 trip to the store, take note of every single penny that you spend. Track it in an Excel spreadsheet so it’s easy to edit, compare and add up based on categories. You may be shocked at how much you spend on seemingly small, inexpensive things.
Figure Out Where You Can Cut Spending
Once you’ve got a good idea of how much you’re spending every month, select a couple of categories that you can realistically spend less. Rent/mortgage, utilities, health insurance, and others are likely fixed costs that don’t change much from month to month. However, things like eating out, entertainment and shopping may be contributing to your excessive spending and are relatively easy to cut back on.
Compare Expectations to Reality
A budget only works if you stick to it. At the end of every month, compare the ACTUAL money spent to what you BUDGETED and see how you did. Ideally, you will be right on the money! However, this can be harder than it sounds particularly at the beginning of one’s budget journey. It can take some practice and changes in habits to naturally stay within your budget. We know you didn’t mean to spend $500 on eating out but it just happened! Keep yourself in check regularly and you’ll be on the right track to achieving your financial goals.
Focus on Reducing Debt
If you carry a lot of debt, be sure to add a line item for paying it off in your budget, and not just the minimum payment. When you have high amounts of debt, you are paying high amounts of interest, which is a total waste of your hard-earned money. Focus on paying down debts with the highest interest first and then work your way down your list.
Have an Emergency Fund
You never know when the unexpected is going to happen. You lose your job, have a medical emergency or your car needs major repairs. Always be sure to have an emergency fund so you don’t have to rely on credit cards to cover these expenses. Aim to have at least six months of living expenses in the event of job loss or the inability to work.
Save as Much as You Can
The easiest way to do this is to set up an automatic transfer every month. Then, it’s as if the money was never there in the first place. Experts say to save 30% of every paycheck; however, that may not be feasible and that is ok. Even saving small amounts will add up over time.
Ready to get started with your financial goals? Contact Eastex Credit Union today to find out how we can help you grow your wealth in 2019, open a new savings account, or whatever you may need to feel good about the new year!