New Year’s resolutions don’t have to be reserved for diets and exercise. Sometimes the area of your life that really needs attention is your finances. If you can get your finances, both personally and in your business into shape, the rest of your life will run smoother.

The new year is the perfect time to give your finances a boost. Here are a few financial New Year’s resolutions that can help improve your financial health. 

1. Start investing:  Rich people invest money and poor people spend it. 2022 is a great time to review where your money is going and how it is being used, investing can be as simple as foregoing the daily coffee and using the funds to invest in a managed fund, to planning a structured investment strategy such as a SMSF or a full financial plan.

2. Build your emergency fund: Most experts recommend keeping three to six months' worth of expenses in an emergency fund, this is appropriate for your personal budget and for your business. With the uncertainty that has been seen of the last couple of years, people losing their jobs and businesses not being able to open, having reserves is always important to help you weather any storm that may come your way.

3. Pay off your debt: Net debt is expected to be $729 billion—or 34.2% of GDP—at 30 June 2022 and peak at $981 billion or 40.9% of GDP in 2024–25. What does this mean? It means the country’s debt levels are increasing but yours doesn’t have to. While interest rates are low it is a great time to start planning to pay your debt down. You can balance transfer your outstanding credit card debt to low or no interest rate cards, re-negotiate your home loan to a lower interest rate and put extra money into an offset account or make additional payments towards your loan, doing this can reduce the term of your loan substantially and save you thousands of dollars.

4. Start a budget and track your expenses:  If you don’t have a budget, you may as well be financially blind. Without a budget you can’t set and track your goals, your income, or your expenditure. In business a budget is a must and is the only way (coupled with a business plan) to see structured growth. Personally, it is important too, even if you have a fixed income, to understand your outgoings and where your money is being spent, invested and how much it costs to live. This will help you plan and achieve the small wins you want every day.

If you would like to learn more about setting financial goals or implementing a budget for you and your business, contact us today.