It’s been a long time since you kicked off a fresh new year with big financial goals to achieve in 2021. We don’t blame you if life pushed a few of them back into a dusty, forgotten corner – but you don’t have to wait until January 2022 to reset and refocus! Here are 4 tips to help you reset your budget and money goals and finish the year strong.
Get your emergency fund up to $1,000
Life happens. Maybe a couple unexpected events made a dent in your wallet, or the definition of “emergency” got a bit lax. If you’ve still got a lot of debt, we recommend starting out with an emergency fund of at least $1,000.
Action Item: Whatever your situation, find a few areas where you can adjust your budget to get your emergency fund back up to $1,000. Then, aim to build your emergency fund up to cover three to six months of expenses.
Refresh your budget
At times, it’s easy to adopt a “set and forget” mindset when we create a budget. But like any habit, your budget works when you actively review what you’re spending – instead of just adjusting your budget to make things fit after the money’s already gone.
Action Item: Sit down and review your budget categories, and identify areas where you’re chronically going over budget. Similarly, review areas where you’re consistently under budget, and consider if that money would be better allocated to a different category or goal.
Plan for annual expenses
The end of the year can be busy, especially with holiday travel, gift giving, and more social outings. While these are all fun activities, extra expenses can add up quickly and pack an unpleasant punch to your budget when the new year rolls around.
Action Item: Plan early and write down a list of upcoming expenses for the holiday season. Using this list, determine how much you can afford to spend or where you need to make cuts. This can be a great time to set limits on spending for gifts, or find more cost-effective alternatives for your usual traditions.
Review your goals
Whether you’ve fully paid off a debt or downsized your vehicles, a budget refresh can also be a great time to celebrate your wins!
Action Item: Take a moment to look back on your progress and acknowledge how far you’ve come, and give yourself a pat on the back. Then, double down and focus on your next goal. Before you know it, you’ll be celebrating another financial win!
A refreshed budget can give you a new perspective on your financial progress. But if you’re tired of trying to manage your budget and pay off debt on your own, you don’t have to do it alone. Strong Tower Consulting has helped over a thousand clients pay off over $7 million in debt – so request your free session today!