The start of a new year is a great time to reassess your financial health and set new goals for saving money. Between rising inflation and a looming recession, many folks will be eager to start 2023 by reevaluating their savings and spending habits . To help you with your money matters in the new year, EBONY asked five money experts for their top tips for financial success.
Assess Your Goals
Reassessing your past spending is a great way to access your current financial health shares Brian Bristol, CEO and founder of Pigeon. "The new year makes the most sense to review finances because you have an entire year's worth of financial data to help you audit your purchases, analyze where most of your money went, and take tabs on how much money you have in checking, savings, retirement, and investments," he says. "A comprehensive look at your financial situation will help you make any necessary adjustments. It is also a good time to think about any major expenses for the year, so you can create your action plan for how to save monthly for those major purchases."
Focus On Your Debt
Tackling your debt at the top of year is a smart move says Trae Bodge, Smart Shopping Expert at truetrae.com. "Lingering debt can be like a ball and chain, so I recommend prioritizing it in the New Year. Depending on your situation, you can use a few different strategies to tackle your debt. Focus on your highest interest commitments first while splitting your monthly payments in half and paying twice a month," says Bodge. This might mean cutting back on your spending, finding ways to increase your income, or both. It also might mean seeking professional help, such as working with a financial advisor or a credit counseling service.
Pay Yourself First
Another way to save money and reach your financial goals is by paying yourself first. The idea is to save a portion of your income before paying bills or making other purchases.
"A good goal to aim for is to save 10% to 15% of your income each month, or any amount that you feel comfortable with," says Tania C. Foster, a financial advisor and founder of PlanTrust Wealth Management. "If your employer offers you [the means] to split your paycheck into more than one account, you may want to consider it." Consider setting up automatic transfers from your checking account to a separate savings account or a 401K plan to make this process easier. "If you don't see that money in your check, you won't miss it," reasons Foster.
Swipe Less, Save More
"The old adage cash is king can actually save you money," says Lisa L. Baker, executive coach and founder of Ascentim. Using cash can help you stay on budget and be more mindful of your spending. Although it's convenient, swiping a debit or credit card makes it easy to lose track of how much we're spending. Try opting for cash instead of credit cards when shopping.
"Using the cash method lets you control exactly how much you spend. And it alleviates the shock when you see your billing statements," explains Baker.
Find a Side Hustle
"Side hustles are an excellent way to expand on your professional skills and increase your income from something that comes to you effortlessly and brings you joy," shares Monique White, Head of Community at Self Financial. "The potential to bring in extra income can give you the capacity to create a solid budget and focus on your financial goals, like paying off debt or increasing your savings contributions." Overall, it can be a great way to earn extra money and achieve your financial goals while also building new skills and connections.
By being proactive, making a plan and staying focused on your goals, you can set yourself up for excellent financial health in 2023.