- Set a goal – Having a well-defined, attainable financial goal will help shape all of your decisions around how you save and spend your money. Research shows that when you incorporate the SMART strategy to defining any goal, you increase your chances of achieving it. Be sure your goal is Specific, Measurable, Achievable, Relevant and Time-Bound. For example: “I will save $2,000 by June 1st, 2024, to go on a five-day vacation to Orlando, Florida.”
- Make a budget and stick to it – Your monthly budget is your roadmap. List your monthly total income, then subtract all of your expenses, and categorize them by necessity. Where can you cut back? The key to making a budget is to be honest with yourself. The more transparent you are about your spending habits, the easier it will be to stick to a budget.
- Save for the long-term – What you do today directly affects your future – especially when it comes to finances. Consider setting up monthly transfers from your checking account to your savings account to make saving automatic. Talk with a Banking Specialist to learn about the best type of savings option for your goal. Even if it’s only a small amount every month, just get into the habit of saving.
- Get out of debt – Regardless of the amount, you don’t want debt hanging over your head. Interest rates will cost you more money over the long term and it can also take a toll on your mental health. Make a plan: Pay off your highest interest debts first, or “snowball” your debt by paying off the smallest debt first and working up to the largest. The feeling of momentum makes change happen!
- Build an emergency fund – Many Americans don’t have any emergency savings. Even fewer have enough to cover the recommended three months’ worth of necessary expenses should an emergency occur. Set aside a portion or your income each month (see budgeting!), you can quickly save up enough money to handle almost any costly event life throws your way.
- Enhance your financial literacy – Knowledge is power and with it comes the confidence needed to make smart decisions about your money. Check out the endless books, broadcasts and online options to improve your financial knowledge.
- Don’t beat yourself up – The topic of money can be stressful, so celebrate your small wins along the way. Consider rewarding yourself with a pat on the back, or a treat, when you hit a milestone toward your goal. No matter what type of reward you choose, just be sure it’s in the budget!
Learn more about how First Citizens National Bank can help you or request an appointment.