8 Financial New Year’s resolution for 2023
A new year signifies new beginnings, and one important area of your life to focus on is your finances. Additionally, a survey by Leger points to money being a major cause of concern for many including Canadians. By making financial resolutions and sticking to them, you can improve your financial health and set yourself up for long-term success, so here are 8 financial resolutions to boost financial growth.
Understand your finances and credit score
Learning about your finances and increasing your personal knowledge of how money works makes you better equipped to make informed financial decisions. Take advantage of educational resources on the SEC website, Motley Fool, FINRA, etc. Also, know your credit score, credit report, assets, liabilities, and taxes.
Create a personal financial plan
Think about what you want to achieve financially and create a plan for it. A financial plan is crucial to achieving your financial goals. It helps you identify your current situation, assesses your needs and wants, and outlines a path to achieving them. Your plan should also contain your goals that are specific, measurable, attainable, relevant and time based (SMART). Your financial plan should also include a budget (breakdown of income and expenses), a savings plan (how much to save and where), and an investment plan (strategies for building wealth and means to achieve them).
Have an Emergency fund
Emergencies happen without prior notice, and it's important to prepare for them. Creating an emergency fund- a savings account incase of emergencies, will provide you with a soft-landing incase they arise. A smart option is setting 20% of your monthly income in an easily accessible account.
Choose your Investments wisely
Exploring profitable investment schemes will help your money grow and enable you experience all-round growth. Stocks, bonds, mutual funds and real estate are options to consider, you can also opt for guaranteed investments if you don’t like the volatility of high-interest investments. Historically, the S&P 500 index returns 10% annually, and Treasury Inflation Protected Securities (TIPS) are recommended . Each type of investment also carries a potential risk so do your research.
Protect and guard your financial estate
To reduce your risk exposure to unforeseen life circumstances, protect your financial estate by getting various forms of life, car and property insurances. These can be achieved by diversifying investments, using asset protection trusts to guard against creditors, lawsuits etc., and getting a financial advisor.
Monitor and track your expenses
It is important to keep an eye on your spending and make sure you are not overspending. Infact, a survey reports that majority of Canadian households are now making changes to their shopping habits. Use a budgeting app or spreadsheet to track your expenses and see where your money is going. This will help you identify areas to cut back on and save more, thereby optimising your expenses and making better informed financial decisions.
Increase and boost your earning portfolio
Sometimes inferred as get-a-side-hustle. Find out new means to boost and increase your earning portfolio. Areas like freelancing, unused spaces or rooms for leasing, highly-sorted expertise, involvement in short term gigs that help earn more etc, are valuable ways to increase your earning portfolio in the new year.
Send money with Africhange
Africhange is a cross-border remittance service that allows you send money in different parts of Africa, North and Latin America (including Nigeria, Canada, Ghana, and Mexico). Arguably with the best exchange rates, Africhange is reliable, easy, fast, and convenient. If you need to send money internationally, Africhange is a great option to consider.
By making these financial resolutions and sticking to them, you can take control of your finances and set yourself up for long-term success. So make a plan, set some goals, and start working towards a brighter financial future.