This article first appeared in the January newsletter for my local MOPS chapter. I had the pleasure of being asked to write a little something about financial resolutions for the New Year and decided to republish it here as well. Enjoy!
Ok, ok… talking about finances might not actually be a whole lot of fun, but as a Financial Coach I can assure you that life is less stressful when your finances are in order. When I help families put a plan together, I can almost see the stress melting away! The Bible mentions money hundreds of times, and while God cautions us not to “love” money (1 Tim 6:10), He does expect us to be good stewards of our finances so that we may provide for our families (1 Tim 5:8) and bless others. This year, getting on track with your finances is completely doable – here are some tips to help you get started:
- Review (and stick to) your budget. This seems like a “no brainer,” but this also seems to be the area in which families struggle the most. All families have a budget. The question is whether or not your family is following it! Get started by printing out 3 months of bank statements to see where your money is going. You’d be surprised at how much those trips to Chick-fil-A add up! Look for areas of spending where you might be able to cut back or save. And be honest with yourself, your spending, and living within your means. One of the things I enjoy doing for families is helping them find money they didn’t know they had! That results in money which can be put towards other important things (savings, debt, investments, insurance, tithing, etc).
- Save your money! One of the biggest reasons families fall into financial distress (aside from job loss) is not saving their money. An unexpected expense pops up and suddenly you’re faced with a financial emergency – leading most people to credit cards (which starts the cycle of debt) or borrowing from family and friends. Having an emergency fund with money set aside for the unexpected solves this problem! Additionally, most families also need a separate “short term” savings fund for expenses they know are coming. For example: the trip to Disney, a new car, or a home improvement project. This year, commit to saving just $84 each month and by the end of the year, you’ll have $1,000 tucked away.
- Make one extra payment on your mortgage this year. Just one extra payment on your mortgage every year shortens the length of your loan by 4-5 years! You can spread this out over the course of the year if one whole extra payment isn’t manageable. And if you really want to make an impact on your debt (yes, your mortgage is debt!), look into starting a debt stacking plan that could cut the length of all your debts – saving you thousands of dollars in interest payments. If you’re not sure how debt stacking works, feel free to ask me!
- Get the right insurance. Having the right auto, home, and life insurance for your family not only provides you with peace of mind if the unexpected should occur, but having the right insurance can also save you a ton of money! Many families don’t realize they could be overpaying for their insurances or could possibly be underinsured. Just looking at this one area of your finances alone could drastically change your overall financial path!
If all of this seems overwhelming, that’s ok! The key is to start small – take just one step and implement one tip listed above. Once you’ve done that, you’ll feel great – and taking the next step will be easier! And remember: I’m here to help! My advice and coaching are free, so reach out if you have any questions!