Let's Get Financially Organized for 2019

Each New Year brings a sense of excitement about the possibilities of achieving all the goals we want for yourself.  It is the time to start fresh and take on new challenges.  One challenge that we all have for ourselves but rarely succeed at is achieving financial organization.  Sometimes getting your finances organized can seem a bit overwhelming, but by setting a few annual and achievable goals, it can be easier than you think.  Here are five suggestions to help you get financially organized for 2019:

1. Draft a Monthly Budget

Last year at this time, I talked about setting up a personal budget and I provided tips on how to balance your personal budget.  Without one, it will be difficult to know what financial goals you can achieve because  you do not know with confidence how much money you have each month.   While setting a budget might seem like a common task, many people find it hard to complete this activity each month and stick to it.   A monthly budget is the cornerstone of gaining better control of your finances.

2. Take Control of Your Debt

Do you have revolving credit card debt?   Meaning you do not pay off your balance in full each month and only pay the minimum or some amount greater than that but less than the entire balance.  If so, than this should be one of your primary goals.    Make it a priority to payoff your debt in as short of time as possible.  You can use a credit card payoff calculator from bankrate.com to help you figure this out.   By following Tip #1, you will have an idea of what spending will need to be scaled back in order for you to prioritize your credit card debt.  It is also important to make sure that you do not add any more debt throughout the year.

3. Make an Emergency Fund a Priority

Medical costs, major vehicle repairs, job layoffs, or house maintenance can quickly derail a budget. You should make sure that you have a fund set up specifically to handle these unforeseen expenses, so you don't have to alter your monthly budget to accommodate. A good rule of thumb is to establish an initial cash reserve that will cover  at least 3 months of fixed expenses.

4. Prioritize Retirement Savings

Saving for retirement is something that people do not place a high priority on; especially younger people who have 30 plus year to go before retirement.  However, it is important to save for retirement as early as possible because the more time you have to save the more time your investments have to grow and the better return you will have on your investment. If you are paying down your debt, this goal should be a priority.  However, try to at least contribute up to the amount that your company will match up to or at least 5 %.  If you do not have to tackle much debt, consider contributing at least 10% of your gross income for your retirement.  For 2019, you can actually contribute at much as $19,000 ($25,000 if you are over 50) into your 401K Plan.

5. Save for Non-Retirement Goals

What big things do you have planned for the next 1 to 5 years?  Whether that goal is to go on vacation to Hawaii, buy a new car, or make improvements to your kitchen, now is the time to make really good estimates of what the costs of those goals are and begin saving for them now.  By planning and saving properly, you will avoid having to go into credit card debt to fund these goals.

_{This content is developed from sources believed to be providing accurate information.    The opinions expressed and material provided are for general information only.}