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6 Financial Resolutions for 2022 

6 Financial Resolutions for 2022 


If you’re looking to make an impactful resolution for the new year, resolving to improve your financial situation is a great goal. Here are six important financial resolutions that will help put you on the path to a stronger financial future.

1 Evaluate your spending habits 

Creating a budget that you can live with should be top on your list of financial resolutions. It begins with evaluating your spending habits. A focused budget can help you achieve many of your financial goals. Calculate your expenses and then cut back on expenses you can easily control. You may need to adjust your budget on a regular basis as your income or expenses increase or decrease. Saving should be an important item in your budget. Setting defined goals and identifying priorities can help you stick to your budget.

2 Pay down debt 

High-interest debt can quickly become a burden and wreak havoc on a balanced budget. Keep your debt at a manageable level, eliminating higher-interest debt. A low-interest balance transfer credit card, such as Choice One’s VISA provides a special balance transfer rate that can help those struggling with high-interest credit card debt. A debt consolidation loan is another option for paying off multiple debts with a loan that provides one, easier to manage payment. Tap for debt consolidation loan options.  When evaluating and creating your budget, be sure that paying down debt is a priority. Focusing on paying off debt may mean reducing your spending or increasing your income with a part-time job or side hustle. Once you pay off your high-balance cards, stay focused and don’t charge them back up again.

If you are going to try to pay back your debt the old-fashioned way, with focused monthly payments, there are two different ways to pay down debt faster. The debt avalanche method is a way to focus on the high-interest debt first. You make minimum payments on all of your debts and then focus all of your extra money each month on the debt with the highest interest rate, eventually working your way down the list. An alternate method is the snowball method. With this method, you again make at least the minimum payments on each debt but focus all extra funds on paying off debt with the lowest balances first. You’ll have the gratification of seeing zero balances on different debts as you pay them off.

3 Save for an emergency 

An emergency savings fund can help prevent financial devastation in the event of an unexpected and costly emergency. It’s recommended that you put aside three to six months’ worth of living expenses into a dedicated emergency savings account. Some potential emergencies might include loss of job, a large medical bill, or a costly home or auto repair.  An adequate emergency fund can help you prepare for just about any financial surprise.

4 Contribute to a retirement plan 

If your employer offers a 401(k) plan and you’re not contributing, you’re making a mistake. Starting to build for your retirement early is a great stepping stone to financial security later in life and one of the most important financial resolutions. The amount you contribute to your 401(k) is deducted from your paycheck before taxes (within limits). This saves you on taxes. In addition, many employers will offer a matching contribution. This means they will match your contribution up to a certain percentage of your salary. Although you may contribute more, they may match up to a certain percentage. This is basically free money, so you want to be sure to maximize the employer match.

5 Focus on estate planning

Do you have a will? If not, you’re not alone. According to a recent Gallup Poll, only 46% of adults have a will that describes how they would like their money and estate to be handled after their death. It also enables parents to name a guardian for their children. Select an estate administrator or executor. It’s important to select a responsible individual that you trust. In addition to drafting a will, it’s the perfect time to update your beneficiaries on your 401(k), insurance policies, retirement accounts, and investments. Your life may have changed since you first named your beneficiaries. Things like marriage or divorce may call for a change in beneficiaries.  Finally, regularly review all of your documents for updates after major life events.

6 Join a credit union 

If you’re not a member of your local credit union, you’re missing out on many important benefits. Credit Unions are not-for-profit organizations. They return the profits to their members in the form of higher returns on savings and investments and lower interest rates on loans. Member satisfaction is also a top priority of local credit unions. Members come first. Tap to learn more about joining Choice One Community Credit Union. 



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