Happy New Year! 2021 is here, and we hope you’re having a happy and healthy new year. Today’s blog from Foundation Credit Union showcases some New Year’s resolutions to get your finances on track in 2021.
Build an Emergency Fund
If 2020 taught us anything, it’s that everyone should consider having an emergency fund. Financial experts say you should save at least six months’ of your expenses in an emergency fund. It’s never too late to start saving for this fund. Think about that cup of coffee you buy on the way to work every morning, or when you eat out at a restaurant. Over time, those things add up. Consider putting them into a savings account instead.
Pay Down Unsecured Debts
As of June 2019, the average credit card debt per U.S. household was $8,398. Having a lot of credit card debt can dampen your financial goals for the year. Not only do you have to make regular payments, but your payments go up when you don’t pay down the debt due to accrued interest. Pay down your credit card debt as much as possible, and avoid putting more debt on there unless you absolutely have to in an emergency.
Make Extra Mortgage Payments
Did you know that making one extra mortgage payment per quarter reduces the time you have a mortgage by 11 years? Imagine the money you could save on interest! Make sure you designate each payment as going towards the principal on the loan rather than the interest.
Stick to Your Budget
Make a monthly budget and stick to it. That means don’t pay for extra things on credit cards, find ways to cut costs, and prioritize your financial health in 2021. Find ways to reward yourself for sticking to your budget, like a celebratory cup of coffee once per month or splurging on pizza delivery for your family on the last day of the month.
Prioritize Your Disposable Income
Once you develop stronger disposable income amounts, prioritize what to do with it. Do you have student loans? Consider paying down some of them. Think about paying down car loans, a mortgage, or investing in your retirement. You have plenty of options when you have extra income to spend after you stick to your budget.
Financial Tips by Foundation Credit Union
Foundation Credit Union is here to help you maintain and improve your finances. Now is a great time to get your finances on track as 2021 begins!. Contact us online or call 417.895.2770 for more information on how we can help.
