SEARCH OUR BLOG

ARTICLES BY TOPIC

RECENT ARTICLES

RELATED ARTICLES

The Blog

December 27, 2023

New Year’s Financial Resolutions

by Team Pathview

The new year is here, and with it comes new ambitions, goals, and resolutions. But 2024 is going to be a bit different. Know why? Inflation and economic uncertainty! Yes, you heard that right. 73% of respondents to a survey have named both these things as top financial concerns for the coming year.

In addition, 75% are stressed about saving money and paying bills. Such factors and concerns can make achieving financial goals a daunting task. In this article, we’ll discuss top financial resolutions for millennials, how to set your resolutions, the key steps you need to take to achieve them, and more. Let’s begin!

Financial Resolutions For Millennials

Start With Identifying Your Goals

When it comes to financial resolutions for the new year, the very first thing you need to do is identify major goals for that year. Think about what it is you’d like to achieve. Are you planning to buy your first house? Do you want to launch your business? Your goals, regardless of what they are, will require a monetary commitment.

Know that identifying and setting goals allows you to develop a plan that you can then use to make efforts towards achieving them. When you’re setting goals, you need to have a strategic approach, and using the SMART framework generally works well.

When you create goals using this framework, you ensure that what you’re looking to achieve isn’t too broad and that you have measurable metrics to track your progress. This framework will also ensure that you set goals within the resources you have and that they’re relevant to what you want to do in life.

Financial Steps To Achieving Your Goals

Financial resolutions for the new year can be a bit challenging to achieve. Some of the common New Year financial resolutions include paying off debt, saving money for family children, or a major purchase or life event. Some key steps you can implement to achieve your financial resolutions in the coming year include:

Saving More

Saving more money is something all of us want. However, doing it effectively without a proper plan is daunting. To make sure you save towards your goals, follow the steps below:

  1. Identify your income and expenses.
  2. From your expenses, determine areas of unnecessary spending.
  3. Cut back on those expenses to increase savings.
  4. Calculate how much money you need for certain goals.
  5. Dedicate a specific amount from your savings towards those goals at regular intervals.

Paying Off Debt

Millennials, on average, carry around $78,000 in debt, and paying it off is quite concerning for them. To manage paying off what you want this year, follow the steps below:

  1. List all the debts you have.
  2. Decide on a debt repayment method. You have two options: the snowball and the avalanche methods.
  3. Make minimum payments on all your debts, and then use the remaining amount to pay off the debt identified based on the method you’re using.

Planning For Major Life Events

Major life events can include things like getting married, buying a house, starting a college fund for your kids, or launching your business. Needless to say, all these require money. To make sure you’re financially set for such events, you should:

  1. Identify which life events you’re likely to experience in the coming year.
  2. Calculate financial commitments associated with these events.
    • If you plan on buying a house, what’s the down payment?
    • If you want to send your kids to college, how much is the expected tuition?
    • If you’re starting a business, what’s the interest rate on the loan?
  3. Determine if your savings are enough or not.
  4. If not, identify additional sources of income.
  5. Create a saving plan for each life event.

Earning More

Having more income is something that’ll push you one step closer to achieving your goals. One of the most feasible methods to increase your earnings is investing. To invest:

  1. Calculate your savings and decide on an investment budget.
  2. Determine which assets you want to invest in. This includes stocks, bonds, index funds, crypto, etc.
  3. Finalize different investment vehicles and keep your portfolio diversified, as it can help you reduce risk.
  4. Consult with professionals to allocate capital effectively.
  5. Monitor your returns and balance your asset allocation based on real-time changes.

Key Financial Steps To Implement In 2024

Survey reports show that 47% of respondents cited not being financially prepared and not being able to maintain the necessary habits as key reasons for not being able to keep their financial resolutions this year. Given this, learning and implementing these financial steps is essential as it can help you change your financial position.

  1. Budgeting – you must ensure that during the coming year you develop and live by a budget. To create one, calculate all the income you have. This includes your salary, overtime compensation, bonuses, side hustle, etc. Then, list down expected expenses such as necessities, bills, debt payments, and so on.
  2. Saving – be sure to keep your spending to a minimum so that you can save towards your goals. To do this, identify unnecessary expenses like unused subscriptions and cut back on them.
  3. Emergency fund – calculate what your expenses would be for a six-month period and use your savings to create an emergency fund worth that amount.
  4. Investing – focus on creating passive income by investing in profitable assets, but make sure to diversify and rebalance your portfolio.
  5. Retirement – this year, plan to set yourself up for early retirement by exploring options like a 401(k) plan, an individual retirement account (IRA), or a Roth IRA.

Key Takeaways

Everyone sets financial resolutions, but achieving them can be daunting. Factors such as inflation, economic uncertainty, ineffective habits, and lack of financial readiness continue to pose a challenge. To achieve financial resolutions, cut back on unnecessary expenses, increase your savings, and invest. Consulting with a financial planner can help you make informed investment decisions and help you focus on future long-term goals, such as retirement.

Get in touch with us and learn more about how we can help you create a customized retirement plan today!

 

You might also be interested in:

Does Your Wealth Management Firm Optimize For Taxes?
Does Your Wealth Management Firm Optimize For Taxes?

A wealth management firm generally works with high-net-worth individuals, providing them with tailored investment advice to generate more profits. In addition, these firms also typically help clients manage their assets and provide a variety of other services that...

Do Your New Year Resolutions Include Planning For Enjoyment?
Do Your New Year Resolutions Include Planning For Enjoyment?

Financial resolutions for more enjoyment this year? Yes, please! The new year has just begun, and for now, all of us are motivated to achieve our New Year’s resolutions. New Year’s resolutions often include living healthier, improving work-life balance, and (we hope)...

8 Tips To Avoid Holiday Overspending Debt
8 Tips To Avoid Holiday Overspending Debt

Winter vacations are right around the corner, and it’s that time of the year again when people gear up for celebrations, travel, parties, and gifts. It’s also that time of year when people tend to spend more than they should on gifting and leisure activities. While...

Year-End Planning: Financial Organizing
Year-End Planning: Financial Organizing

Here at Pathview & Associates, we talk a lot about the importance of year-end planning for taxes. Evaluating your tax situation prior to the end of the year for any tax-smart moves you can make goes a long way in reducing your future tax liability. Year-end...

The Financial Impact of Alzheimer’s: Long-term Care Costs
The Financial Impact of Alzheimer’s: Long-term Care Costs

Did you know over 6.1 million people in California are over the age of 65? Recent studies show that around 840,000 people in California could be living with Alzheimer’s disease by 2025. According to the Alzheimer’s Association, people 65 and older with Alzheimer’s...

Does Your Wealth Management Firm Optimize For Taxes?
Does Your Wealth Management Firm Optimize For Taxes?

A wealth management firm generally works with high-net-worth individuals, providing them with tailored investment advice to generate more profits. In addition, these firms also typically help clients manage their assets and provide a variety of other services that...

Do Your New Year Resolutions Include Planning For Enjoyment?
Do Your New Year Resolutions Include Planning For Enjoyment?

Financial resolutions for more enjoyment this year? Yes, please! The new year has just begun, and for now, all of us are motivated to achieve our New Year’s resolutions. New Year’s resolutions often include living healthier, improving work-life balance, and (we hope)...

8 Tips To Avoid Holiday Overspending Debt
8 Tips To Avoid Holiday Overspending Debt

Winter vacations are right around the corner, and it’s that time of the year again when people gear up for celebrations, travel, parties, and gifts. It’s also that time of year when people tend to spend more than they should on gifting and leisure activities. While...

Year-End Planning: Financial Organizing
Year-End Planning: Financial Organizing

Here at Pathview & Associates, we talk a lot about the importance of year-end planning for taxes. Evaluating your tax situation prior to the end of the year for any tax-smart moves you can make goes a long way in reducing your future tax liability. Year-end...

SEARCH OUR BLOG
ARTICLES BY TOPIC

RECENT ARTICLES

RELATED ARTICLES

Let's Connect!

NEWSLETTER

VISIT US

1455 Frazee Road, Suite 700
San Diego, CA 92108

CALL US

P: (619) 295-0200
F: (619) 295-0210