As we kick off 2024 and wade through the financial scene, it’s time to set goals for our money resolutions. Personally, I’m all about setting and hitting goals, but let’s be real – not everyone can pull it off without the right setup and support. There’s nothing more frustrating than reaching the end of the year and realising that all the plans you made got tossed aside.
But guess what? This year, we’re turning it around. We’re setting money goals that are not just doable but will also make this your best year yet.
Before we jump into the nitty-gritty of these resolutions, let’s give a nod to the economic challenges we’ve been dealing with and are still grappling with. The shadow of the inflation crisis from previous years is still hanging over us as we step into the new year. According to the Reserve Bank of Australia (RBA), they’re not expecting to hit the midpoint of their inflation target until 2026. Tough times, but we’re gearing up to tackle it head-on. With this in mind, let’s break down the five money resolutions that can pave the way for your financial success in 2024 and put you in the position to have your best year yet.
- Take pressure off yourself – Set short term goals
It’s common to take on the burden of financial challenges and start blaming ourselves when we fall short of certain expectations. Yet, in the face of a cost-of-living crisis, it’s vital to change how we view things.
Remember, you’re not alone; plenty of others are facing similar challenges. Instead of blaming yourself, shift your mindset to proactive problem-solving. Reach out for support, educate yourself on financial literacy, and make decisions based on knowledge.
Recognising external factors can lighten the load and allow you to approach your financial journey with a healthier perspective. Your financial history doesn’t define your ability with money, so don’t be too hard on yourself.
Short-Term Goals
A short-term financial objective is a financial goal that you want to achieve within a relatively short period, typically within one year. These objectives can be singular goals or incremental steps to larger financial goals. Some common short-term financial goals include setting a budget, starting an emergency fund, paying off debt, and saving for personal goods or experiences.
To identify and set short-term financial objectives for the new year, you can follow these steps:
Define Your Goals: Determine what you want to achieve in the short term, such as paying off credit card debt, building an emergency fund, saving for a vacation, or making a major purchase.
Set Specific and Measurable Objectives: Establish clear and achievable financial goals, such as saving a specific amount of money each month or paying off a certain amount of debt by the end of the year.
Create a Budget: Develop a budget that aligns with your short-term objectives, ensuring that your income covers your expenses and allows you to make progress toward your goals.
Track Your Progress: Regularly monitor your finances to see how you are progressing toward your short-term objectives. Adjust your budget and spending as needed to stay on track.
- Spend less
In a world filled with enticing advertisements and pressure to keep up with the latest trends, reining in your spending is a fundamental resolution. Understand that every dollar saved today contributes to being more financially secure tomorrow.
Consider creating a budget, differentiating between needs and wants, and finding ways to cut unnecessary expenses. Be mindful of your financial goals, and let them guide your spending choices and be aware of how other people’s financial goals might be impacting yours.
- Save more
In times of uncertainty, a resilient emergency fund serves as your financial safety net, becoming even more crucial than ever.
Ensure the presence of a sufficient cushion to address unforeseen expenses or potential job loss. Take advantage of the current higher interest rates by exploring savings accounts that offer more favorable returns. While these elevated interest rates may have posed challenges for mortgages, they have proven advantageous for our savings accounts.
This year, I’ve observed high-interest savings accounts with rates ranging between 4 and 5.70 percent. Enhance the productivity of your money by optimizing your existing savings strategy. Consider automating your savings process to maintain consistency and foster discipline in fortifying your financial safety net.
- Get your personal insurances in order
As we face an undoubtedly challenging year ahead, ensuring the stability of your income ranks among the most crucial steps you can take. It’s perplexing to think that people invest in insurance for their cars but often neglect to safeguard their income, despite the fact that we rely on income to replace a damaged vehicle.
Life and personal insurance can serve as a protective shield in the event of job loss, life-altering illnesses, or unfortunate accidents. These policies create a financial safety net for your family, offering peace of mind during tumultuous times. Make it a priority to commit to this resolution in order to protect both your financial well-being and that of your loved ones – it’s a step that can significantly enhance your peace of mind.
- Schedule a monthly check in
Regular monitoring and adjustment play a pivotal role in achieving financial success. Mark a monthly date on your calendar to assess your financial progress, whether individually or with your partner. This routine check-in enables you to track accomplishments, pinpoint areas for improvement, and uphold accountability to your goals.
The lack of planning has hindered many in the past, but a dedicated monthly review ensures that you stay on course and make necessary adjustments as needed. Consistently checking in allows you to pause, reflect, and redirect if a goal isn’t progressing as anticipated.
This is the year for you to transform your financial habits, and by embracing these five money resolutions, you’ll not only navigate the challenges of the current economic landscape but also lay the groundwork for a secure and successful future – irrespective of your starting point.
Remember, it’s not about making grand gestures; it’s about taking consistent, intentional steps that will guide you toward financial well-being.
- Get reacquainted with your credit score
Enter the new year knowing what lenders see when they look at your financial profile — and avoid potential future headaches. You have a right to obtain a copy of your credit report for free every three months from reporting agencies Experian, illion, and Equifax.
Make sure to check the report carefully for any inaccuracies.
Money Smart suggests checking that:
- All the loans and debts listed are yours
- Details such as your name and date of birth are correct
If you do find an error, you can contact the agency and ask them to fix it. This is a free service.
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