Not only is it the start of a brand new year, but a completely new decade. It’s a great opportunity to reevaluate your finances and completely change your money mindset. If you were looking for a fresh start for your finances, then now is as good a time as any.
Whatever your ultimate finance goal, it’s always wise to work on your personal finances and take actions to make improvements each year. So let’s take a look at what you can do in 2020 to achieve your finance goals and make the most of your money.
Set a budget
Budgeting isn’t for everyone but if you’re needing to focus on your finances then setting a budget is a good way to start. It can help you make the most of the money that you have, spend less, save more and make sure that your money is going where it really needs to.
Pay off your debts
If you are serious about sorting out your finances, then paying off debt should be where you start. Debt incurs huge amounts of interest, which would be much better off going elsewhere in your budget. Payings debts off as quickly as you can will help to improve your cash flow and give you more money to spend on other things.
If you’re using a credit card, then try to pay it off in full each month. If you’re struggling with larger amounts of debt on your credit card then look at ways that could help you to pay it off, such as a zero interest balance transfer card.
Save for a rainy day
We know that saving can be hard. However, having a cash buffer in place for emergencies can really help when you need it the most. Experts recommend that you should try to have at least three months worth of salary as a bare minimum, six months would be even better. In a fragile economy, a savings fund is essential but you could also consider other options such as income protection insurance.
Think about your retirement
Even if it seems a long way off, it’s good to think about your retirement at a young age. It’s nice to have disposable income to enjoy, but try and balance it out by putting some savings aside for the future. These finance goals may not seem the most exciting, but you’ll thank your younger self when you’re in your sixties and able to live comfortably because of the choices you made at the time.
Most employers have pension schemes, but you could also look at private pensions. It’s also worth looking at high-interest savings accounts and ISAs which will help you to make the most of your money.
Save for a deposit on your first home
Getting a mortgage is one of the most significant financial purchases you’ll make and it can be a great investment for the future. But you’ll be unlikely to do it without first having a deposit to put down. Most lenders will expect at least 10% of the purchase price. A larger deposit will typically open up better interest rates.
Take a look at your budget and work out where you can save each month. Pay into a savings account that gives you the best return. It can be hard work, but it’ll be worth it once you have that place to call your own.
Improve your credit score
Your credit score can impact your financial decisions. Without a good score, you may not qualify for a mortgage, loan or a credit card. Improving your score, if necessary, can help you to achieve your finance goals, particularly if you are planning on buying a home. There are numerous ways to improve your score – get some really useful tips here.
So you’ve read our list of simple finance goals for 2020, which ones do you think you’ll adopt. Or do you have your own ideas that you’d like to share? Feel free to comment below with your 2020 finance goals!
The above post does not constitute advice – financial, legal or otherwise. The information within this article is the author’s own opinion and do not necessarily reflect the views of SO Media or So Smart Money.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.