Blog

5 Reasons Why Personal Finance is an Important New Year’s Resolution

By John T. Fenton, President and CEO of Affinity Federal Credit Union

In 2018, only one-third of Americans1 planned on making financial resolutions. But 2019 is proving to be more promising. In fact, nearly all American millennials2 plan on prioritizing their finances in the new year. Can we make 2019 the year for a nation-wide focus on financial wellness for all demographics?

New Years Finance

The New Year is an excellent time to wipe the slate clean, and to set both long- and short-term goals – whether buying a new home, paying off a loan or purchasing a car. As you look to the year ahead, remember why personal finance is important and follow a few easy rules:

1. Checking your credit report often. Credit reports are intimidating. Your credit score affects a lot – the ability to purchase cars, homes, open new accounts, rent an apartment, etc. Instead of fearing it, embrace it. By checking your credit report often, you’ll have a handle on that number and what’s affecting it. That way, you’ll feel more in control of the outcome. You may even be able to obtain this information for free. Certain financial institutions, such as Affinity, provide free quarterly credit scores to their members.

2. Tracking your personal finances is important. You’d think this is commonplace, but it’s not. According to a recent study3 nearly half of Americans spend more than they make each month. That’s a dangerous habit! Having a budget and ensuring you’re keeping to it is a sure-fire way to maintain a healthy financial foundation. Without it, you run the risk of overspending and putting yourself into debt.

3. Cutting unnecessary spending. Ever log onto your bank account app and wonder where that $40 went? You’d be surprised. We often swipe our cards for the simplest things. In 2019, consider adding some restrictions around your spending. For example, make coffee at home vs. stopping at an expensive coffee place, make lunch for the week vs. buying it and cut back on those shopping habits…we all have them!

4. Avoid neglecting your debt. Nearly every American has some form of debt. It’s nothing to be ashamed of. Instead of neglecting it, prioritize paying it off. That way, you’re not only chipping away at a short-term goal, but you’re contributing to whatever long-term goals you might have by paying off a loan and contributing that money toward other areas of your life. Ask your financial institution if they can help. Affinity members have access to assistance with loans, debt consolidation and available online credit counseling tools.

5. Building up your emergency fund. You can’t plan for everything in life. That’s where an emergency fund comes in. Say your house needs repair or you need to shell out extra cash for unexpected dental work. Having extra money in a reserve helps ensure you don’t put yourself into a situation where you can’t pay. We can’t stress enough how important it is to have an emergency fund.

Most importantly, resolve to lean on your financial institution in the year ahead. Don’t hesitate to sit down with a Financial Advisor to ensure the goals you’re setting make the most sense for where you are in life. After all, when it comes to personal finance, advice isn’t one-size-fits-all. And when it comes to setting 2019 resolutions, or any financial goal for that matter, remember why it is important to consider where you are in life and tailor accordingly.

Looking for new products and services to jumpstart your 2019 goals? Click here to explore all Affinity has to offer.

1 CBSNews.com
2 AP News
3 USA Today

This information is for informational purposes only and is intended to provide general guidance and does not constitute legal, tax, or financial advice. Each person’s circumstances are different and may not apply to the specific information provided. You should seek the advice of a financial professional, tax consultant, and/or legal counsel to discuss your specific needs before making any financial or other commitments regarding the matters related to your condition are made.  

Back to Blogs