7 Financial Resolutions for the New Year
Written on Dec 30,2021 by Joe Mahlow
New year, new (financial) goals.
Here’s a few financial resolutions to consider for the upcoming new year and some advice on how to achieve them:
There are so many ways you can go about this. Increasing 401(k) contributions, setting up automatic transfers to high-yield savings accounts, and cutting back on unnecessary spending are all good approaches. An unexpected way to go about saving more is by using a credit card to your advantage. Many offer competitive rewards and statement credits that can earn you cash back, points, or even airline miles that will, in turn, offset some purchases. Think outside the box.
2.Improve your credit score.
If your credit score is less than impressive (think below 700), make a priority this year to work on raising it. You can improve your score in a myriad of ways. A way to make a major impact is to pay your bills on time and in-full, because on time payments make up such a huge percentage of your score. Consider setting up autopay to take remembering off your plate.
3.Make a budget.
Tracking your spending might seem intimidating at first, but it will get easier. A concise budget can help you to set guidelines for yourself on what you can afford to spend and help you identify where to cut back. Start with writing down your fixed expenses (rent/mortgage, phone, groceries, etc.) and then see what you’re left with for flexible expenses (eating out, clothing, entertainment, etc.). Look at your bank statements for an easy layout of your spending habits to help you get started on your budget planning.
4.Pay credit card debt on time.
Look into the expiration date of the interest-free period on your card. Create a plan to make significant payments (that you’ve included in your budget) toward your debt through the intro period. This will keep you on track to being debt free by the time that period ends. Boom.
5.Pay the full credit card balance each month.
Without question, payment history is the most important factor that goes into your credit score. This means paying your balance on time and in full every month can make a huge difference. Paying the whole balance will help to reduce your utilization rate as well as reducing interest charges or fees resulting from carrying debt month to month. Paying in full each and every month might not be possible, but make sure you can at least make the minimum payment on time. This will help you avoid late fees, which can be steep, and any penalty interest rates.
6.Check your credit score more often.
There are many resources that will allow you to check your credit score for free. Depending on which route you take, you can potentially receive an updated credit score every month and see exactly which factors are influencing your score. Being familiar with your credit score is the first step in improving it.
7.Check your credit report more often.
Yes, your credit score and credit report are two very different things. It’s important to regularly check your credit report so you're able to spot any potential fraud early on and make sure the correct information is reported to the credit bureaus. There are a lot of options when it comes to viewing your credit report, so do some research. You’re also entitled to one free credit report per year from each of the three main credit bureaus. If you want to improve your score or need to correct some errors you’ve found on your report, contact us at ASAP Credit repair, we know what to do to get you on the right track for the upcoming year.