Ah, the new year. The holidays are over, but if you’re not careful, that holiday debt can follow you into 2023. There’s no better time to take control of your finances than right now. Whether your goals for 2023 include paying down debt or saving for a rainy day, here are some helpful ways to get your finances under control in 2023 and leave last year’s bad money habits behind.
2023 Money Goal Inspiration
One of the first goals you may want to set in 2023 is to update your emergency fund. First, do you have one? If not, creating one could be a great place to start your 2023 money management strategy. Having an emergency fund can help you ensure your overall financial plan doesn’t get wrecked in case you lose your job, need to buy a new car, or any other inevitable emergencies pop up.
Another helpful money management strategy is to create specific and realistic financial goals. Want to save money? Pick a reasonable amount you can put aside from each paycheck. Try to avoid setting far-fetched and unattainable goals, as those can set you up for financial failure. Instead, look for long-term goals that you can break into realistic short-term goals to ensure you stay motivated as you work toward your longer-term goal.
Money Management Strategies
How do you manage your money? If you don’t have a solid answer, 2023 is the time to implement some solid money management strategies into your financial life. First, decide what’s most important to you: saving for a vacation, traveling, paying down debt, or something else entirely. Knowing why you’re managing and saving your money will help keep you encouraged and on track to achieving your financial goals.
Once you have your financial priorities in order, you’ll want to find money management techniques that align with your financial goals. For instance, your strategy may be as simple as creating a budget and setting up a few automatic transfers. You may also find that the snowball or avalanche techniques for paying down debt makes the most sense for you. Budgeting apps are a popular choice for tracking income and expenses, though some find the hands on approach of the envelope system to be the best fit. Explore your options and choose one (or more) that you can adapt into your lifestyle.
Financial habits to break
We all do it: a spontaneous purchase in the check-out line, too many subscriptions we don’t actually use, buying a french roast before work every morning. These small splurges
can really chip away at your budget and put you at risk of lifestyle creep. That’s especially true as inflation makes it harder to save and therefore even harder to recover from spending $100 a month at your favorite coffee shop.
Some bad financial habits are more obvious, though: not paying off your credit card balance, only making minimum payments on your bills, and paying your bills late, among others. The first step to breaking a bad financial habit is identifying the action. Next, you’ll want to ask yourself why you fall into that bad habit. Are you overspending because you shop when you’re bored? Whatever the issue and the cause, ask yourself what you can do short-term and long-term to conquer the habit. For instance, instead of online shopping you can read a book or call a friend when you’re bored. In the long term, you can address your boredom by taking up a new hobby or a second job. You could even make money by selling crafts from your new hobby or use your side hustle to pay down some debt.
Financial habits to try
On the other hand, you may want to try a new habit or two in 2023. One habit you may want to consider adopting is actually an internal change: creating a healthier money mindset. Instead of focusing on the deficits your money situation may have created in your life, such as limiting your ability to travel, ask yourself, “How can I make money work for me?” By viewing money as a tool to help you conquer your life goals instead of the goal itself, you can focus on the positives surrounding money instead of the limitations a lack of money can create.
Do you invest? If not, 2023 may be the time to start. Or if you do, then you may want to create new investing goals, such as trying out dividend growth investing. Another goal could be creating or building a stronger financial safety net, such as beefing up your emergency fund or updating your life insurance policy.
Around the Web
Need more financial inspiration for 2023? We searched the web for more tips on creating and keeping your money this New Year.
You don’t have to let your 2022 financial mistakes follow you into 2023. By giving up bad money habits and replacing them with better ones, you can grow your savings and kick your debt to the curb in 2023.
Need help keeping your 2023 money goals? SoFi Insights® is a budgeting app that can track your income, set up financial goals, and help you keep tabs on your spending.
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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.