Is one of your resolutions for the new year related to finances? Then you’re in good company because many working adults decide to revamp their financial situation for the better as the calendar turns to January.
The key to success is creating a detailed plan, complete with monthly budgets. For most people, the next step toward fiscal fitness is to reduce expenses as much as possible. Only after getting a handle on cash outflow should, you explore the idea of taking on additional work hours or a part-time job. Other critical components of the program include doing a complete insurance review and finding ways to save on groceries. Here are suggestions to get your money goals aligned for success in 2022.
Develop a Financial Plan
You work hard for your money and should protect your income by making the smartest financial choices possible. Spend several hours creating a new financial plan, and don’t forget to include one-time expenses like annual dues for professional organizations, upcoming medical bills, or vacation costs. It’s easy to miss non-monthly items when making a budget. Your plan should include every source of income and spending, no matter how small, and whether or not it’s recurring. For instance, if you expect to receive a bonus from your employer toward the end of the year, estimate what it will be and include the amount in your detailed write up.
Reduce Monthly Expenses with Smart Cuts
Anything that can reduce monthly cash outflow will add to the effectiveness of your new financial plan. If you currently pay on more than one student loan, work with a private lender to refinance and consolidate them all into a single obligation. It makes sense to take advantage of better terms, rates, and repayment periods to slice monthly expenses by a significant amount. See if you can find other places in the budget that could use improvement, like the amount of money you spend on impulse purchases, fast food, and bar tabs. It’s not about living a spartan existence but finding a better way to use the money you have.
Additional Income & Insurance
If you wish to add to the income side of the balance sheet, consider taking on a part-time or micro job for a few hours per week. Even online tutoring on weekend afternoons can put muscle into your annual income. However, don’t add work hours to your life unless your situation demands that you do so. Review health, life, car, homeowners, and other insurance policies to see if you can save by placing them all with a single carrier. An insurance consolidation can often save people as much as 20 percent on their coverage expenses.
Chop Grocery Bills with Two Clever Tactics
Perhaps you have already gotten your food spending in line with your overall budget, which is an important move. Consider further reductions in grocery bills. You can accomplish much by joining a wholesale club to potentially chop about $1,000 off annual food bills. Likewise, invest in a standalone freezer that you can keep in a garage or basement. Buying meat and perishables in bulk and freezing them can help you save a lot on high-priced grocery items.