5 Financial Goals to Set Now That Will Help Reduce DebtJan 17, 2019
Debt stress is a reality for many Canadians, but it’s even more evident once those holiday bills hit your mailbox. So let’s talk about how you can reduce debt, set financial goals and make 2019 less stressful.
What financial lessons did you learn in 2018?
At the beginning of a new year, it’s a good idea to reflect over the previous year and the lessons you learned. Jot down a few notes on a piece of paper:
Which financial decisions was I proud of last year?
What could I have done differently?
How can I ensure a better outcome this year?
Your answers to these questions will help you determine which goals are most important. For instance, did you turn to debt more often that you wanted to? Or did you forego adding to savings in order to pay for a trip? Don’t think of these as failures, think of them as a learning experience that will help set the tone for your 2019 goals.
Five goals that will help you find debt relief
Whether you are determined to reduce debt, save more money or simplify your spending, these strategies will get you there. And, it’s important to note that all financial decisions have a ripple effect.
For instance, you can’t focus on debt relief without paying attention to spending, just like you can’t save more money if you’re fighting unmanageable debt.
Here are some easy-to-implement steps that will help you tackle your financial goals.
- Practice mindful spending. Did you add to credit card debt over the holidays? How much will those purchases cost you over time? Mindful spending involves taking note of your spending habits and trying to make healthier choices more often. This might mean reducing impulse spending, avoiding retail email sales or shopping within a cash budget.
- Assess your wants and needs. When you find yourself daydreaming about a new spring wardrobe or a late-winter getaway, it’s good to remind yourself about wants vs. needs. Setting financial goals doesn’t mean ignoring your wants altogether, it just means finding a balance between the two so you’re still meeting your goals without derailing your financial plan.
- Make your budget your best friend. Use a budgeting app or worksheet so you can see where your money is going each month. Got an important event coming up? Add it as a line in your budget so you can plan ahead and have the cash on hand. Once your budget is in place, automate your monthly bill payments to save yourself time, and make sure you’re not incurring late charges.
- Find a debt repayment method that works for you. There’s no one-size-fits-all when it comes to finances. See what works for you and your family by trying some new techniques. The debt snowball or debt avalanche are popular. You can also try DIY debt consolidation by combining your high-interest credit card debt into a low-interest line of credit. Or, compare your options using our repayment options calculator.
- Find ways to stay motivated. The thing about New Year’s resolutions is that they don’t stick. It’s too much pressure to say you’ll change XYZ and make it last. Instead, it’s better to make changes all year round that support your goals. And guess what? Your goals can change too. Revise your goals every few months if they’re not working for you. The best way to stay committed to your goals is to find what inspires you. Check out these bloggers for some daily money motivation:
- The Classy Simple Life – Michelle created this blog for women who are looking for inspiration, whether in travel, finance, fashion or lifestyle. Follow her on Twitter here.
- Simply Frugal – Follow Taya as she discusses parenthood, thrifty ways to save, household tips and DIY ideas.
- Young Guys Finance – Justin, Irvin and Shun created this site to teach millennials how to set smart goals, invest and keep an eye on spending. They offer both free advice to your inbox along with weekend boot camps to whip your finances into shape.
How will you reduce debt in 2019? Find more debt tips by connecting with us on Twitter #LeaveDebtBehind #ChangeYourMind #DebtSolutions