As the new year rolls around, lots of people start thinking about the things they want to achieve over the next 12 months. And getting your money sorted is always something that ranks toward the top of the list.
But where do you start?
We’ve put together five top tips to start 2019 right financially below.
1. Ditch The Debt Hangover
Reports last year show that Aussies racked up over $29 billion in Christmas credit card debt last year. And this year that number is tipped to be even larger.
But trying to get ahead while you’re running a bunch of credit card debt is tough going. It’s like trying to fill a leaky bucket, you take two steps forward then one back.
If you end up with credit card or personal debt over Christmas, ditch it. ASAP. This will save you money in dead interest payments, and free up your income and savings to use to get ahead.
If you end up with more money owing on your credit card than you can repay quickly, think about using a balance transfer option to reduce your credit card interest costs and help you pay down the debt faster. If you follow this approach, make sure you’re disciplined and use a strategy to pay down your debt fast so you don’t get caught in the debt cycle.
2. Set Some Goals
Saving money sucks. Spending it is way more fun. In fact, the most fun thing you can do with your money is to spend every dollar you earn and a little more for good measure. So if you’re not spending your money like it’s going out of fashion it helps to be clear on why.
Generally, you save money because you’re working toward something else that you want even more than that sweet sweet dopamine hit that comes from a binge spending spree. If you can keep your focus on this other thing or goal that you really want, sticking to your strategy gets a whole lot easier.
Get clear on why you’re putting in the work to get ahead. Think about the end result you’re aiming for, when you’ll get there, and how good it will feel to have it. Then, keep reminding yourself of your goal as you’re putting in the work to make it happen.
3. Streamline Your Savings
Once you’ve got some goals set, saving is what will make it happen. But most people suck at saving money. If you don’t have a good system to make saving easy, it’s tough going.
Today our money management is more complex than ever before. You get paid, shuffle money from one account to another, pay some bills, try to put some money aside for your spending, run out, spend more, get caught short at the end of the month, spend a bit more on the credit card, and the cycle continues.
This doesn’t work. To make it easy for you to save, you need a savings system. Get clear on your spending, put your savings first, set up your banking to get the right money in the right places at the right times, then automate everything so you set your default to savings success.
4. Start Investing
The power of time and money is a beautiful thing. Even if you’re starting with no savings or investments, as long as you’re consistent and stick to your strategy you can create some powerful results over time.
For example, if you invested just $10 per day into the Australian share market over the last 10 years, you’d have over $54k today. If you started 20 years ago, you’d have over $180k. Starting 30 years ago would mean you have over $470k. And over 40 years you’d have more than a whopping $1.13m.
This shows the power of getting started with investing. It also shows that the sooner you get started the better your results will be.
The best time to get started was 20 years ago. The second best time is right now.
But when you don’t have much (or any) experience investing it’s common to have some fear around getting started. If you want results you need to push through that inaction and make it happen. Build your knowledge around investing so you can get over the fear factor and start investing your way to money success.
5. Be Accountable
Anything worthwhile isn’t always easy. Money is no different. When you’re trying to get on top of your money, there will no doubt be challenging times. Having someone to keep your motivation up can help you push through any tricky periods and stay on track.
Your accountability buddy can be your partner, a mate, colleague, a professional financial adviser, or some random on your favourite social media channel. The trick is to find someone that can push you forward and have tough conversations when you need it.
If you’re going to speak to a finance professional, take the time to understand what a financial adviser actually does before you jump into the process so you can get the most out of it.
The Wrap
The new year is a wonderful time. A magical time. Anything seems possible. There’s a sense you can do anything.
Money is a huge momentum game, so leverage this motivation to keep your momentum building and make 2019 the year you crush it with money.
Need more help with your money? Check out our Career & Money section to get a leg up.
Image credit: Stocksy
