Do you think you need to strengthen your finances before the end of the year? Well, there is always room for improvement when it comes to your money. Even if you have already reached your ideal emergency fund, level of savings, investments and assets, you can still do something to improve your financial situation.
The truth is, a lot of surveys are showing that the overall financial position of Americans are improving. In fact, a survey done by Bankrate last February of 2015 revealed that this is probably the year of financial security. This means consumers are starting to feel more secure about their finances. According to the survey results, every area in the report showed improvement. These include savings, debt, job security, and net worth. The article on the site mentioned how consumers used to feel unease regarding their savings. Now, even that showed some improvement.
All of this simply means people feel more confident about their finances. This is good news indeed.
However, you need to exert a certain amount of caution. Sometimes, too much confidence could bring about your downfall – especially when you start becoming too reckless about your financial decisions. Too much complacency can be dangerous too.
This is the reason why you may want to keep on improving your finances so you will never be reckless in spending your money. That is especially true now. You need to think about what you can do about your finances before the end of the year. After all, we are just about to start one of the most expensive seasons of the year.
10 tasks that can make your finances stronger before the end of the year
There are a couple of tasks that you need to work on so you can strengthen your finances before the end of the year. That way, you can start 2016 with a strong, stable and secure financial position.
According to the 2014 news from ConsumerReports.org, the Great Recession altered the way we spend in this country. The financial losses that we experienced then made us cautious with how we parted with our finances. We were made aware that we only have limited finances and that we should be smart about how we use it.
The same report that came from the Consumer Reports National Research Center also revealed that after 7 years since the last recession, we are now ready to spend. While we remain cautious, we are now in a financial position that is confident enough to push through with the expenses that we had been postponing. These expenses include homes, cars, appliances, vacations and home renovations.
It seems that Americans are now excited to spend their money. While we all deserve that, it is important for you to analyze and strengthen your finances first.
So what are the specific things that you can do in order to make your finances stronger before the end of 2015?
- Revisit your financial goals. You can start by revisiting your financial goals. If you set goals at the beginning of the year, you can check your progress and see if you can change something to reach it faster. In case you do not have goals, you may want to set up one now. At least, something that you can accomplish short term.
- Give yourself something to accomplish until the end of the year. This is to help you add more financial improvements. You can choose to assign a task every week or each month. For instance, you will review your budget this week. The week after, you will create your holiday spending plan. The week after that, you can opt to save $100. The list can go on an on. It all depends on the financial activities that you think will strengthen your finances.
- Review your monthly bills. If you have subscriptions or other bills, you may want to check if you can change something to lower your costs. You may be able to bundle your Internet and cable subscriptions so you can pay less for both. You can even check your appliances and equipment to see if they are using too much energy. If they do, then you may want to consider getting ones that are more energy efficient.
- Evaluate your spending. This is the perfect time to look at your spending habits too. Look at what you have bought so far. Are you happy with what you bought? Do they all seem like a great buy now that you are looking at them again? Analyzing your spending gives you an excuse to reminisce and at the same time, review if you had been smart with your spending choices. If not, then you may want to identify the causes that led you to buy those items. To improve your finances, you need to practice smart spending.
- Add more to your retirement savings. This is an important saving goal so we need to give it special mention. If you can afford it, put more money into your retirement. There is no better way to strengthen and secure your finances than by investing in your future. The more you save now through retirement investments, the bigger it will get because of compound interest. If your current contributions have not yet reached the maximum for the year, you may want to keep on adding towards your retirement fund.
- Look at your emergency fund. Do you have enough? Do you think you need to add more? If you have yet to reach your target, you may have to boost your monthly savings so you can build up this fund. You cannot strengthen your finances without looking at your emergency fund and feeling confident that it can get you through the tough times.
- See if you need to get an insurance (or change it). This is a great way to secure your family. It can be health insurance or life insurance. Being insured makes you feel more secure that in case something happens, you can get the finances that you need to get past that situation.
- Think about your taxes. You may want to consider your taxes as early as now. If there are documents and expenses that you think you can use to get tax breaks, you should compile them now. Organize your financial records so it will be easier for you to file them on April 2016.
- Plan for next year’s expenses. Since you are already thinking about taxes in 2016, you should start thinking about the expenses that you are most likely to make next year. Do you have plans to go on a vacation? If you do, then you may want to think about where you will go and your budget for that trip. If someone is reaching a milestone next year, you should probably start saving up for that too.
- Donate to charity. Finally, you may want to think about making donations to the less fortunate. Although you are trying to strengthen your finances, there is always someone who needs help. This is not really something that will make your finances stronger or more secure – but it will make you feel good about yourself and your financial situation.
Follow these tips so you can improve your finances before the end of the year.
How to be smart with your money towards the end of the year
Consumer spending this year is steadily improving. According to the data coming from Gallup.com, the average spending of Americans is going down. The average daily spending in August this year is $89. In 2014, it was $94 and in 2013, it was $95. Now it is a lot lower than that. This could mean that consumers are smarter when it comes to their spending. Or it could mean they are gearing up for the expenses during the holiday season.
Regardless of your financial situation, it is clear that you should prepare yourself to end the year with stronger finances. Here are a couple more tips to help you strengthen your financial position.
- Have a holiday budget plan. This is a must. If you plan on spending a lot this season, be prepared to do it on a budget. Although you are expecting a lot of money because of holiday bonuses, it still pays to be prepared with a budget so your spending will not go overboard.
- Try to avoid debt if you can. If you plan your holiday spending early, you should be able to avoid debt. Save up for your expenses so you do not have to use your credit cards.
- Choose your expenses. Giving out gifts is common this season. However, it does not mean you should spend a lot. You can always DIY your gifts so it will not cost you much money. This is a great way to personalize your gifts too. The same is true for your decorations. If you plan it ahead, you should have enough time to DIY some of your holiday requirements to minimize spending.
- Prepare your financial plan for next year. Finally, you should set aside some time before the end of the year to create your financial plans for 2016. This should help you consider the strength of your financial situation and determine if you are ready to face the financial challenges of next year.
If you think that it is hard to strengthen your finances because of all the things you have to do, there are ways that you can actually simplify it. We have here a very simple formula from a guy named Richard Fowler. Here is a video of him giving three simple tasks that can help you strengthen your finances for the future.