February 15, 2018
• 6 Minute Read
New Year’s resolutions are a popular way to set new goals at the end of the year. No matter your past indiscretions or whether or not you improved your life last year, a new year means a new opportunity to get things right.
Maybe you want to lose weight, quit smoking, or finally start eating better. Or perhaps you are angling for a better financial picture – one with less debt, less stress, and more money for fun.
Unfortunately, as many as 80 percent of New Year’s resolutions fail by February according to recent research. For that reason alone, it’s fairly certain your New Year’s resolution won’t last.
8 Money Resolutions You Can Mostly “Set and Forget”
If your resolutions are financial ones, on the other hand, there are some shortcuts that can make sticking with your plans fairly easy. By automating some of your money goals and resolutions, you can make financial progress without worrying about getting off track.
A piece of pie might tempt you away from your diet, but there are some financial changes you can’t undo that easily. If you’re looking for an easy way to stick to your money goals this year, try these strategies:
#1: Boosting your contribution to a work-sponsored retirement account
If you have a work-sponsored 401(k), setting yourself up to save more this year should be a walk in the park. Whatever percentage you’re contributing now, take that and knock it up a notch. If you’re setting aside 7 percent of your income to get your full company match, for example, boost that to 9 percent. Or, if you’re saving a solid 10 percent, crank it up to 12 percent.
If you aren’t contributing to a retirement account at all, well, doing so is the easiest way to make sure you save more this year than last. Just make sure to make it automatic so you don’t forget. The easiest way to do this is to head to your company’s Human Resources office and fill out the appropriate paperwork to boost your savings at work.
#2: Setting up automatic bank transfers to a savings account
Another tip: Set up automatic bank transfers that take money from your checking account and move it to a savings account every month. You can set up automatic bank transfers on payday, on a specific day of the month, or whenever works for you. Just make sure you make it automatic so you don’t forget.
#3: Sign up for a money-saving app
Money-saving apps can take the guesswork out of saving money or earning cash-back. With the new Dosh app, for example, you can earn more cash-back and receive special savings just for downloading it to your phone and using it in conjunction with your credit cards when you shop.
Digit is another app that can help you save with no effort at all. This app takes your income and spending into consideration, then figures out the ideal amount of money for you to save each day and saves it for you.
Last but not least, Acorns connects with your credit card to help you invest seamlessly. The app rounds up every purchase you make, then invests your spare change so it can grow. You’ll hardly notice the difference when you start using the app, but your investments will grow automatically.
#4: Drop one expensive habit
If your goal is saving money this year, one of the best ways to accomplish this goal is to reduce your spending. But, unless you want to do a major spending overhaul, this goal can be tricky. Sometimes it pays to look for the lowest hanging fruit – your bad habits – and start there.
Do you smoke? Quit and you could save $5 per day or more. Do you stop by Starbucks on your way to work every day? Make coffee at home and save $4 per weekday or $80 per month. Do you always overspend at the mall? Stop going. Seriously.
#5: Keep track of your credit score
If you want this year to be the year your credit score soars, your best course of action is tracking it religiously. While you may get a free copy of your FICO score with your rewards credit card, there are plenty of other ways to track your credit score for free.
For example, offer some very basic personal details here and you can get a free estimate of your credit score in a matter of minutes.
#6: Move your debt to a 0 percent APR credit card
This new year’s money resolution is different than the others on the list because you CAN mess this up. But, hear us out: If you go about it the right way, you can use a balance transfer card to save money and get out of debt.
Here’s how 0 percent APR cards work: Once you sign up for a balance transfer card, you’ll get 0 percent APR (zero interest) for anywhere from 9 – 21 months depending on the offer you sign up for. Some cards charge a balance transfer fee of 3-5 percent to get started, but others waive this fee for the first 60 days.
If you transfer your high interest debts to a card that offers 0 percent APR and no balance transfer fee, you could save money on interest and pay down debt faster since your entire payment will go to the principal of your balance.
However, you should keep in mind that you have to stop using your credit cards for this strategy to work. If you keep racking up debt, a 0 percent APR card will not leave you better off.
#7: Have a weekly no-spend day, or a monthly no-spend week
If you’re worried about overspending or just want to see how long you can go without buying anything, try planning a weekly no-spend day or a monthly no-spend week. With either of these strategies, you’ll spend those days (or weeks) only spending on absolute essentials like basic food for meals and bills.
While this strategy may not help you grow rich over the long-term, it can help you break hurtful spending habits and save up some short-term cash. And, you never know; you may get so used to not spending money that it becomes the new norm.
#8: Refinance a loan if you can get a better deal.
Last but not least, take a look at the loans you have to see if refinancing could make sense. If you can score a lower interest rate on your home loan or auto loan without paying too much in fees, for example, you could save a bundle without changing your lifestyle at all.
Let’s say you took out a $200,000, thirty-year mortgage two years ago when your credit was less than stellar. You’re paying 6 percent APR on your loan, and your monthly payment (including principal and interest) is $1,199.
But, now your credit is better, meaning you can qualify to refinance at a lower rate, If you refinanced your mortgage into a new loan with 4.5 percent APR, your monthly payment would go down to $1,103, saving you nearly $200 per month and thousands over your repayment timeline.
Heck, you could also refinance your loan into a new twenty-year mortgage at 4 percent APR and pay just $1,212 per month – cutting years off your repayment and saving a bundle along the way.