New Year’s Resolution: Improve Your Financial Health in 2021

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January 13, 2021 by Lisa Brammer

I’m not sure what your New Year’s resolution was in January 2020, but I’m betting it didn’t take long before it got hijacked as we all got obsessed with our personal health and the health of our loved ones. What choice did we have?

Hopefully this year we can turn our sites and focus on another kind of health—our financial health. If becoming financially healthier is your New Year’s resolution and a priority for you, here are three important tips.

Give yourself a financial physical:  Start by calculating your net worth. Make a list of your assets (stuff you own) and another list of what you owe (your liabilities). Then subtract your liabilities from your assets. That number is your net-worth.  It’s your starting point.  The important thing is to calculate it again in six months or at least yearly. It’s like stepping on the scale or keeping track of your blood pressure readings. You want to keep an eye on it.  If it’s going in the right direction, great. You’re making progress. If not, it’s time to reassess your lifestyle.

Set up a budget: Money comes in, money goes out; it’s the way of the world. But instead of crossing your fingers and hoping for the best at the end of each month, set up a budget. There are lots of ways to do it. There are even apps you can download to help keep you on track. (Check out some here in this great blog from The important thing is to keep track or project what money is coming in (your income) and what’s going out (your expenses).  Then subtract your expenses from your income. If you have money left at the end of the month, again great!  Now you get to decide what you want to do with the extra money: spend, invest or save.  If you’re upside down and in the hole, you will need to figure out how to either increase your income (by getting a second job or asking for overtime at work) or by decreasing your expenses. Neither very fun.  That’s why it’s always important to do your best to live within your means.

When determining your expenses, try to be mindful by separating your wants from your needs.  Needs include things like: food, shelter, healthcare, transportation and clothes. Basic things you need to live.  But you have to be careful.  Sometimes there are expenses that masquerade as a need, but are really a want.  While it is true that a cellphone is a need. Getting the latest and greatest IPhone every year or two puts that purchase in the wants column.  Same could be said for that pair of shoes you want to get. Everyone needs shoes, but if you are thinking of getting a pair by Jimmy Choo they too are a want, no matter how much you think you need them.

Start saving as soon as you can: Saving money is so important many think it should be considered a line item on your expense sheet when setting up your budget.  That way you will have money to service your vehicle when it breaks down or pay for that unexpected health expense. Both needs, not wants!  Plus, it’s never too early to start saving for your retirement. It’s a known fact, the sooner you start the better off you’ll be when it comes time to retire.  If you company has a 401(k) program jump on it! The money is automatically deducted from your paycheck and oftentimes includes a match (think free money). It doesn’t get any easier than that.

Quoting Charlie Epps, from that old television show, Numb3rs, “We all use math every day.” We might as well use it to improve ourselves financially.

Founded in 1950, United Credit Service, Inc. is a full service, licensed revenue cycle management and debt collection agency in Wisconsin providing effective, customized one on one management and recovery solutions for our business partners. Visit our website at, call 877-723-2902 or check out our YouTube video.

image provided by: creative commons

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