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3 Things You Can Do Now to Improve Your Finances in the New Year

3 Things You Can Do Now to Improve Your Finances in the New Year


    Who wants to end 2012 even better financially? You need more than just a “that sounds like a good idea” attitude to make that happen.

    So let’s not waste anymore time, shall we?

    Here are three actions you can take now — before we even hit 2012 — to end next year with a better balance than this year.

    1. Know Your End Game

    What kind of financial standing do you want to end up with in December 2012? Take some time now to plan your financial goals.

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    I recommend figuring out how things went this year. What were you happy about? What could have gone better financially? Were there any bad choices made? Be completely honest with yourself.

    Now think, if you were looking back on 2012 and reveling in how amazing it was for you financially, what would it look like? No, this isn’t “pie in the sky” or “winning the lottery” type of imagining. Figure out logically what you should shoot for.

    If you make your goal too big your brain will start to stress over not yet achieving it.

    Just thinking about what you want isn’t enough though. Try to set your goal in stone.

    After interviewing 50 millionaires, I’ve learned that they do a lot after the goal is set. They use vision boards, goals written on whiteboards, or put goals on post-it notes on their laptops. Then they break down the goal to figure out what they need to do to achieve it.

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    “When I have a goal I’ve written it down and then I know I need to make this happen to achieve the goal. What my action steps are for today, tomorrow, this week, next week, for this whole month, etc.” – Vonda White, CEO of Collegiate Risk Management

    Millionaires don’t do anything crazy or different than the typical advice you have heard about setting goals. Their success lies in that they actually take action to write them down, see them every day and commit to working on them each week.

    Action: Create your End Game in visual form that you will see it every day. Break it down into weekly goals and commit to them.

    2. Get Accountability

    Finances are still a taboo subject. It may mean fighting over money with your significant other, or being hush-hush on how much money you make in the workplace. We tend to complain about money in public. It seems socially acceptable to talk about being broke, or getting good deals on stuff but not about giving advice and helping each other out.

    If you want to win in 2012 with money you can’t be silent. I know this from experience. I was $70,000 in debt and didn’t even realize it. Only when I was able to start talking about it — and doing something about it — did things change. I paid off all $70,000 in 16 months.

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    So find someone that you can talk to and keep you accountable. Find a friend that wants to work on their finances in 2012 too. If you are married, your first choice should be your husband or wife so you can create a strong bond around your finances (but if money is a sore subject though you may need to find a friend you trust instead).

    Set up a weekly or bi-weekly chat with each other. Talk about great choices you’ve made, and what you want to do better in the weeks to come. You can also help each other brainstorm about ways to hit your goals. Commit to that meeting. It will give your finances the attention they need to achieve your goal.

    Action: Email your trusted friend or significant other asking them to help you be accountable in 2012.

    3. Be Thankful

    We all want things to improve next year. I know from working with many clients, we tend to focus on what we don’t want, or how much better things will be when we achieve our goals in the future.

    It’s not about that at all.

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    It’s about appreciating your financial situation now. Even if it’s not what you want. Most likely you have a computer and are reading this on your Internet connection, or maybe even at work. That means you have much more than most people on this planet.

    Make sure your 2012 includes ways to show your gratitude for all that you have. We have so much to be thankful for and sometimes it’s hard to remember that.

    Create a thankful routine. A thankful routine is just something you decide to do when you are feeling down about your money situation, or you aren’t making as much progress as you want to. It might involve writing down a few things you are thankful for, giving a small amount of money or time to someone who needs it more, or even calling family or a friend to remind them how much you love them.

    Money isn’t everything.

    Action: Create your thankful routine. Just pick one thing you want to do when you attitude about your fiances shift negatively.

    Enjoy your 2012. What are your plans to make it the best year yet?

    (Photo credit: Calculator and Money via Shutterstock)

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    Published on January 8, 2021

    How To Pay Off Credit Card Debt Fast: 7 Powerful Tips

    How To Pay Off Credit Card Debt Fast: 7 Powerful Tips

    Ever wondered whether your credit card debt is the reason you’re in a bad financial situation? You can’t enjoy any fun activities because a good chunk of your money goes toward debt payment. Heck, you’re even behind on some of your monthly bills.

    The effects of clumsy debt management are too many to list here. This guide is going to help you discover how to pay off credit card debt fast and start chasing your financial goals.

    Debt problems are the last thing anyone wants to encounter. But things can get out of hand when all the “little debts” you take accumulate in interests.

    What if you knew some simple and proven ways to be debt-free quickly? Implementing them would mean better financial health for you. It becomes possible to free up cash for your “wants.” These include taking a trip or buying something you’ve always desired. All that while paying your bills on time!

    Let’s not wait any longer. Here are 7 powerful tips for paying off credit card debt fast:

    1. Pay More Than the Minimum Credit Card Payments

    Many people only pay the monthly minimum on their credit cards. Truly, that’s the right amount for staying on good terms with your credit card company. But you need a different approach if you’re looking to achieve financial independence within a short time.[1]

    Most of your payments go toward interest costs when you only pay the minimum amount. A substantial sum of your balance remains standing. As a result, it becomes more expensive to eliminate your debts.

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    You don’t want to wait more than 10 years to get rid of debt while it’s possible to do it sooner. All you have to do is double that $100 minimum payment to $200 or go higher.

    The good thing is that minimum credit card payments are affordable in most cases. By paying a higher amount, you reduce your interest costs, lessen your borrowing period, and boost your credit score.

    2. Start With High-Interest Credit Card Debt

    If you have more than one credit card debt, prioritize putting the extra money toward the ones with the highest interests. This debt pay-off strategy, known as the debt avalanche method, is essential for being debt-free quickly.[2]

    First, you need to list down all the credit card debts you have in the order of their interest rates. Next, you choose the one with the highest interest and pay a significant amount toward it each month. It can be an amount twice or even thrice larger than the minimum payment.

    At the same time, you make monthly minimum payments on the other debts. Their interest charges won’t be as costly as that of the first debt on your list. You only move on to the next high-interest debt after the first one is gone. Remember that your focus is on the interest rates and not the balances.

    3. Revisit Your Budget

    Budgeting is useful for tracking your financial moves. Once you create a budget, some tweaks along the way can make it work for you better. One situation that requires you to revisit your budget is when you’re struggling with debts. It might hurt a bit to slash some expenses. But you also don’t want to miss out on achieving financial freedom in the long run.

    You can reduce some variable expenses to free up more cash for credit card debt payments. They’re the ones that change from time to time. Some examples are groceries, fuel, and clothing.

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    Other opportunities for cutting down your spending lie in non-essential expenses. Instead of dining out all the time, you can cook at home more to save money. You can also share some subscriptions with friends and pay a fraction of the cost.

    If you’re determined enough, you can eliminate all your unnecessary expenses and focus on paying off your credit card debt first.

    4. Avoid Using Your Credit Cards

    Do you want to know how to pay off credit card debt with a low income? One simple way is to stop using them. Having your credit cards everywhere you go means that you’ll be more tempted to buy unnecessary stuff. In this case, you spend money that you don’t really own and get deeper into debt.

    The quickest fix to stop the debt build-up is spending with cash. You’ll be more aware of everything you can afford at any particular time. If you decide to keep one or two cards to ease the transition, always make wise choices. For instance, only use them when experiencing financial difficulties.

    It’s best to categorize your fun activities under “discretionary spending” in your budget. This way, you won’t need more debt to kill your boredom. By halting your credit debt from accumulating, it’s easy to pay down what you already owe and be happy with the progress.

    5. Start a Side Hustle to Boost Your Income

    You’re probably turning away a lot of money by not monetizing your skills. Everyone has something that they’re good at doing. And you can use that to generate extra income for attacking your credit card debt.

    If you look around your neighborhood, you can find several side hustle opportunities. It can be pet sitting, tutoring, or lawn mowing. You can start an online business by offering services such as digital marketing, content creation, and web development. Such skills go in high demand on freelance sites and job boards.

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    Finding clients on social media is also a good strategy to utilize your skills and make more money. Facebook groups, Quora Spaces, and subreddits are some places to look for side jobs. You only have to join a niche-specific platform, share your services, and respond to any opportunities.

    It’s possible to learn a skill, practice it, and earn from it. Use the free resources online or purchase some e-courses to get started.

    6. Sell Your Used Items for Extra Cash

    Starting a side hustle isn’t the only way to generate extra money. You can turn unwanted items into cash for paying off credit card debt. Whether it’s an old TV, book, or furniture, there is always someone itching to buy your used stuff.

    A garage sale, as much as it’s old-fashioned, is perfect for getting your neighbors and passers-by to buy from you. You keep all the money because there are no business permits or taxes involved. While you may not make much cash, it’s better than leaving your stuff to go defunct in your storage.

    Other than that, you can sell your used stuff on online marketplaces. Facebook groups are great places to start if you want quick approvals and hence sales. You only have to ensure that your listing follows Facebook’s commerce policies.

    When selling any pre-owned items online, ensure they’re in good shape to avoid problems with your buyers.

    7. Know When to Seek Help With Your Debt

    Asking for help with your credit card debt can be challenging to do. But letting it drown you is a road you don’t want to take. While you may feel embarrassed at first, it’s the best way to get back on track when you run out of options.

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    There are tons of non-profit credit counseling organizations that can offer you free guidance on how to escape the debt trap. An example is The National Foundation for Credit Counseling. They simply review your finances and help you determine the source of your financial problems. After that, they match you with an actionable debt management solution.[3]

    In extreme cases, the debt solution can be:

    • Debt relief – where your debt is partially or wholly forgiven
    • Debt consolidation – taking out one loan to repay others
    • Debt settlement – the creditor forgives a significant portion of your debt
    • Bankruptcy – legal process for seeking relief from some or all your debts

    It’s necessary to carefully weigh your options before deciding on the way to go. Find out how it might affect your credit score and any other risks.

    Wrapping It Up

    Debt is a major setback when you’re trying to prosper in life. Paying off credit card debt is essential if you want to reach your financial goals. That means having more free income, a good credit card score, and even a chance to retire early. You become more productive each day because of the peace in your mind.

    So, you now have some tips on how to pay off credit fast. Go ahead and get rid of that good life progress killer!

    More Tips on How to Pay Off Debt

    Featured photo credit: rupixen.com via unsplash.com

    Reference

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