New Year, New Financial Goals

Creating a financial plan for 2023

When it comes to new year’s resolutions, the most valuable could be to resolve to be more financially secure. As complex as it may sound, you can actually stick to this resolution easily by establishing and sticking with a couple of financial goals for 2023.

Financial goals are different for everyone. Your budgeting and savings goals can vary depending on your stage of life and your family’s needs. But it’s always good to take some time to consider how your financial needs have changed or evolved over the past year, especially with inflation and other economic trends we’ve seen, and determine new ways to achieve your goals. 2023 is a new year and the best time to establish a new plan.

How to set your financial goals

The best thing about financial goal setting is that it gives you the motivation to put these objectives in motion and create a strategy in order to bring them to fruition. Without goals, you may not be able to afford large purchases such as a house or new car, save for future retirement, or have enough money to send your kids to college.

Hopefully, the financial plan you put into place for 2023 will also work to serve you long-term on your road to financial independence. But it’s important to establish some easier, bite-size savings and budgeting goals for just the next twelve months. This way, when 2024 rolls around, you can look back and proudly know that you did something beneficial for yourself this year and be enthusiastic to continue into the future.

Financial goals can be categorized into three groups:

1. Savings
2. Investments
3. Spending interests.

Short-term financial goals can include saving for a vacation, paying off credit card debt, buying a new appliance, or updating a kitchen.

Make a financial plan for 2023 and this could be the year that you:

• Plan a budget and stick with it
• Make a strategy to pay off your student loan
• Open a 401(k) or Roth IRA retirement account and contribute to it
• Save for a down payment on the car of your dreams
• Say goodbye to credit card debt and boost your credit score
• Faithfully contribute to an emergency fund that will give you valuable peace of mind.

There are plenty of reasons to budget, invest, and save money this year. With a simple plan in place, and a dollar amount in mind to contribute weekly or monthly, you can reach your goal by year’s end.

Establishing clear savings goals in 2023 and the years to come will make it so much easier when you’re faced with unexpected expenses and decisions about spending your money. For instance, knowing that you want to save money for a new car makes it easier to spend less on take-out food or a new pair of shoes. In fact, you might want to put a note on your dashboard that says “New car? Or a latte?” to remind you to get out of that drive-through line. Put a photo of the new refrigerator you’re saving for on the door of your old fridge. These small reminders can remind you what you’re working toward and possibly help you to spend less money on non-necessities.

5 Simple steps to meet your financial goals in 2023

1. The first step is to determine your goals,  make them clear, and put them in writing before they slip away. Remember to make financial goals that truly matter to YOU, not what you think looks good to others. Goals that you aren’t passionate about achieving are too easy to neglect.
2. The next step in creating your financial goals for 2023 is to create a budget that reflects the targets you have in mind. Everyone needs a budget. It’s how we get a clear picture of what we’re spending each month and how we can seal up the cracks where money is being wasted. You can go through your bank statements and bills to assemble a spreadsheet of expenses, or you can try a free budgeting program or to simplify the process.
3. It’s never easy to find extra money to put toward your goal, but your budget may reveal where you can find some by restructuring your spending habits. Every financial goal must have a process with which you can achieve it. Basically, this comes down to spending less, earning more, or a little of both. Consider consolidating credit card bills to spend less on interest rates, canceling unused streaming services, or holding a yard sale to get rid of old items. Open your mind to ways you can bring in more money — a part-time job, a freelance project, etc.
4. Create a reward system for motivation to save your money. Making sacrifices to reach your goals can often lead to burnout for the cause. For each week or month that you stick to your plan, anticipate a little reward — one trip to Starbucks for a Venti, a steak dinner at home, or a lunch out with friends. Don’t be above creating a calendar for your budget, complete with gold stars for achievement.
5. Talk to someone you admire, including family members, about the financial goals you’re setting for yourself in 2023 and why they are important to you. Just like any other goal, you may need some occasional support or encouragement to stick to your plan. They can also be important cheerleaders as you achieve milestones.

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Sources:
https://www.investopedia.com/articles/pf/06/newyear.asp
https://www.clevergirlfinance.com/blog/examples-of-financial-goals/
https://www.moneyunder30.com/financial-new-years-resolutions
https://money.usnews.com/money/personal-finance/saving-and-budgeting/slideshows/financial-new-years-resolutions
https://mint.intuit.com/