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Three Ways to Improve Your Financial Wellness in the New Year

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Whether you love or hate the New Year's resolution tradition, studies show that one of the most popular resolutions is healthier living—followed closely by setting financial goals.

Knowing that 72% of people report experiencing money-related stress at least some of the time, financial wellness is proving to be more vital to our overall health and happiness than ever.

Here are some tips and savings tricks that can get you started on the path to improving your overall financial health:

Make a Plan

Mapping out your financial goals is the first step. This will serve as a guide you can reference and fine-tune. Investing, saving for retirement, and reviewing spending habits regularly can seem daunting, but below are a few easy steps to make the process less overwhelming:

  • Conduct research and educate yourself to make more informed decisions
  • When it comes to investing, start small
  • Exhaust all available employer options, such as an employer-sponsored retirement plan, Flexible Spending Account (FSA), Health Savings Account (HSA), etc.

Financial priorities shift and change through our different life stages whether it’s sending your child to school or planning your retirement. The key is setting long-term goals and not letting yourself get discouraged by short-term changes along the way.

To help you get started and take the mystique (and intimidation) out of financial planning, check out First Tech’s primer.

Become a SMART Shopper

Another tip for reducing spending is to stick to a budget. Setting specific, measurable, achievable, relevant, and time-bound (SMART) goals leads to better budgeting. It also allows you to adjust as needed.

For example, eating at home and being mindful of “entertainment” expenses, such as dining out or tickets to sporting events, can help eliminate unnecessary spending. Being a savvy shopper also makes all the difference. This means planning, writing down, and avoiding tempting impulse in-store or online purchases.

Whether it’s spending less on groceries, entertainment, or cutting costs associated with other household needs, it’s important to hold yourself accountable to your specific goal. One way to do this is by working with a friend or family member, so they can help keep you focused and on track to turn your goals into reality.

You'd be surprised how quickly grocery savings can build over time, not to mention how far these savings can be spread elsewhere.

Flex Your Savings Muscles 

Although planning and budgeting may automatically strengthen savings, you don’t have to cut off all your spending to save. There are ways you can boost savings, and still have room to “treat yourself,” all while keeping a cushion for those rainy days. For example, try:

  • Gradually increasing your savings by 1 percent each year
  • Following the 50/30/20 rule by allocating 50 percent of your monthly income towards bills and non-negotiables, and 30 percent towards savings, leaving 20 percent to fulfil wants
  • Utilizing multiple savings accounts to support specific needs using the 50/30/20 rule
  • Using a credit card that deposits cash back
  • Choosing a share certificate – a long-term solution that enables you to steadily increase savings over time, offering a higher yield than alternative savings accounts.

Becoming a (Financially) Healthier You 

It's no secret that many of us are reluctant to talk about money, but real change only happens when you take a close look and rethink your current habits. Get a running start by making a plan, and you’ll be well on your way to improving your financial wellness and reaping the rewards of your efforts.

Consider speaking with a First Tech representative. Our financial professionals can help you with customized planning for your unique situation and goals. Learn more at: firsttechfed.com/learn.