People have great financial ambitions in the New Year, but many people fail to meet their goals or keep their New Year's resolutions because they are too ambitious. A recent article from Nerd Wallet, "3 Simple Steps to a Financially Strong Start in 2016," reminds us that resolutions don't have to be big to have a big impact. Small early wins can help boost your confidence and prepare you for success in the coming year.
Here are three simple steps you can take to reduce your stress and improve your financial well-being for the rest of 2016:
- Talk to your attorney. Discuss any major life changes, such as changing jobs, adding a new family member, retiring, or receiving a financial windfall. In most circumstances, these changes will have an impact on your tax situation and cash-flow, as well as your insurance and estate-planning needs. The earlier you can take them into account in your planning, the more beneficial and less stressful their impact will be. A little planning now can go a long way toward avoiding any surprises later.
- Organize your taxes. You should also gather up and keep your tax information organized. Don't wait until the last second and scramble every April.
- Automate changes. If you automate savings, incremental changes will be easier to realize. For instance, you can automate your contributions to your 401(k). Some employers also allow you to set up an automatic annual increase in your contribution amount, allowing you to save more over time. You can also automate monthly deposits to savings plans, like a 529 college savings plan or other investment accounts.
These steps may seem small, but each can dramatically improve your finances. Small wins at the beginning of the year will help you stay committed to improving your financial well-being for all of 2016 and beyond.
Reference: Nerd Wallet (February 8, 2016) "3 Simple Steps to a Financially Strong Start in 2016"