Now that the surge of New Year’s resolutions have slowed and we’re a week into the new year, perhaps it’s time to take a more objective look at your finances. I’m not talking about the look you take when you’re excited about the new year and determined this will be your year.
Instead, I’m talking about taking an objective look at your finances and getting them in order. Now is the best time to do this because many people, especially those in snowy areas of the country, settle in for winter and don’t tend to spend as much money recreationally.
Here are some things to consider:
1. How much money did you spend on the holidays.
Many people underestimate the amount of money they spend at the holidays. Since we’ve just finished the holidays, now is the time to tally up how much you spent. Now take that number and divide it by 12. Start this month putting one-twelth of your holiday expenses aside each month. Next December, holiday spending won’t cause you any financial difficulty.
2. What vacations will you take?
Are you planning a summer vacation? Take the time now to track down deals and make your reservations. Do you have all the money you’ll need for the trip, or do you need to save more? If you have to save more, how do you plan to come up with the money? Are there some areas of the budget you can trim so you can put more aside for your upcoming vacation?
3. How is your budget overall?
Do you have enough money to cover the bills every month? Do you have an emergency fund? Do you have money to invest in your retirement fund and possibly your children’s college funds? If you answered no to any of these questions, now’s the time to take a hard look at the budget. Where are you overspending? How can you cut corners? Or perhaps you have an income problem. If so, see #4.
4. Can you develop a side hustle?
If your job isn’t netting you enough money, what can you do on the side to make more money? There are plenty of opportunities from freelance writing to babysitting to selling your stuff around the house. Pick a job you have knowledge of and for which there is a need to be filled, and you should soon get your first client.
5. Ask for a raise.
If it’s been awhile since you’ve gotten a raise and you’re boss is impressed with your work, consider asking for a raise. When you meet with your boss, make sure to come prepared. Have a list of skills you bring to the job. Also bring samples of work you’ve done recently that have garnered you praise.
If you are denied the raise, there are other ways you can make your income stretch further.
Take the time this month to reevaluate your financial position. Make and implement plans to strengthen your financial position in 2014. You won’t be sorry.
What other steps do you take when evaluating and improving your financial situation?