Does the thought of a new year give you some hope? 2020 was definitely a year for the books. Some may have experienced financial hardships causing them to worry about the new year. However, we have some great tips below for saving and budgeting in the new year. Start off the new year strong and keep reading to learn some of the best tips and trip for 2021!
- Review Your Spending Habits
The first step to budgeting and saving money is determining what you want versus what you need. In order to make sure your finances are in check in the new year, make a list and separate your wants from your needs. For example, if you are between paying off a bill and purchasing a new coffee mug (even though you have 10 of them already), go with your gut and pay off that bill. That is a prime example of a want versus a need. Now, there are going to be times where you should absolutely treat yourself to things; just make sure you budget for them!
Sometimes looking back at what you spent in aggregate for a category over the year can be a real eye opener. Our clients have access to eMoney which allows you to categorize your spending to keep track of where money is going. Using something like eMoney can show you that you spent several thousand dollars on groceries and eating out so that you have the drive to taper down on food spending in the next year.
- Create an Untouchable Fund
An untouchable fund can be a savings account that you do not withdraw from. This type of account can come in handy for emergencies, such as an urgent care visit or a medical bill. Reserve some of your income for emergencies like this, so that you do not have to scramble to pay these on time. Because of the pandemic, it is in your best interest to create some sort of savings fund that you only touch for emergencies or if you are in dire need.
- Limit Your Outings
As we continue to navigate the pandemic, outings, such as an expensive dinner or concert, are not always necessary events that you need to keep in your budget for health reasons. Now, if it is for a special occasion, allocate some money specifically for that event, but weekly outings like this can really take quite a toll on your savings and budgeting plan.
- Work with Your Advisor
Your advisor can help you develop and maintain your budgeting plan. speaking with a financial advisor about your finances on a frequent basis can help you stay committed to your budget as well as develop new goals within your budget.
LifeBridge Financial Group would love to work with you on your savings and your budget for 2021. If you have not already scheduled a meeting with us, visit our website here and give us a call at (713) 527-8998. We are here to help you grow and succeed in the new year!