Most people look to a new year as a fresh start. Jan. 1 signals a time when changes, improvements and goals can be put into motion.
One of the most common resolutions made every year: financial betterment. People want to pay off debt, save money, and be able to be free to do what they want without having to think about their bank accounts. Getting started with a task like this often the hardest part, but here is a little guidance to get those financial dreams on the path to reality.
Having a financial cushion in case of emergencies should be priority one, if this fund hasn’t already been established. According to financialplan.about.com, financial experts suggest three to six months of living expenses be saved in an emergency fund. However, getting anything socked away is more important in the beginning, especially if debt payments are a part your financial landscape. Simply put whatever seems reasonable for your budget into a savings account, and don’t touch it.
Dave Ramsey is a well-known financial expert, and his book, “The Total Money Makeover,” discusses establishing an emergency fund prior to making any other changes; consult this title for more information on this topic.
Debt reduction will go a long way to increasing take-home pay and padding that emergency fund. Paying down debt can be a long, arduous task, but once it’s done the freedom and money gained will be all the encouragement needed to keep oneself out of future debt. Having savings is important, but it will be difficult to acquire if an entire month’s pay must go toward credit card and loan payments. Search the Internet or financial planning books to find a debt payment plan that could work for your situation. To learn more about debt reduction and how to get started, check out “Debt-Free Forever: Take Control of Your Money and Your Life” by Gail Vaz-Oxlade.
Finally, learning to be frugal can put some extra money in your pocket in 2013. Starting simply with homemade coffee and sack lunches can save a few extra dollars each week. Once those habits become automatic, larger frugal changes can be made to maximize your money. Don’t ever pay someone for something that could be a do-it-yourself project, like an oil change. Clipping coupons and searching out freebies can take time but reap financial rewards. And don’t forget the library. Free access to books, movies, music, the Internet, and events are all at your fingertips with a library card. Check out kckpl.org to find a location near you.
Financial resolutions can be difficult to implement, but well worth the effort. Start educating yourself by checking out personal finance materials from the library and reading reputable websites like getrichslowly.org. If you want to learn more or need further assistance, contact a certified financial planner for more information.
Emma Claudius is the business librarian for the Main Kansas City, Kan., Public Library, 625 Minnesota, Kansas City, Kan.