5 tips for finally following through with your financial resolutions
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So, how are those New Year’s financial resolutions coming along?
* The sound of crickets chirping *
If you’re not on top of any kind of financial resolution this year, don’t worry—you and those crickets have got company.
According to a CIBC poll, the majority of Canadians haven’t been making much headway when it comes to their financial resolutions. In fact, only 26% of Canadians have resolved to even make it a priority to pay down debt. Which is surprising when you consider that national debt-to-income ratio levels are at an all-time high (for every dollar earned, Canadians now owe $1.74 in debt – according to Statistics Canada).
That sheds light on a very important conclusion: more Canadians should be resolving to make (and stick to) financial resolutions.
After all, even as an education member with a generous pension plan in place, you have financial goals beyond being financially set in the future for retirement, right? In the present you have credit cards to pay off and a mortgage down payment to save for (or current mortgage you would like to pay off faster). Perhaps you even dream of taking a 4 over 5 someday, or have big plans on how you’d like to spend a summer break.
Whatever your financial goals—here are 5 simple ways to finally take action:
1. Identify your goals and a timeline for achieving them.
Just as you wouldn’t begin the school year without a plan to get you to the end of June, your financial goals are only as good as being able to commit to a realistic timeframe to making them happen.
Click here for examples of various financial goals and corresponding timelines.
2. Create a budget.
Never fun to create but always functional, budgets are necessary to get the full 360 on your income and expenses.
Click here for how to build a budget that works.
3. Use cash only.
While debit cards make life at the checkout counter a whole lot easier, they’ve also made it too easy to overspend. Using cash will keep you more on track to sticking to your budget. Because once you’ve spent the cash you’ve allocated yourself (based on your monthly/weekly/daily budget), you’re cut off. Using cash may also put you into the habit of thinking twice about making a purchase. If you end up with cash leftover, great! Now instead of spending it, consider putting it towards an extra debt payment or the financial goal you’re saving towards.
4. Take the 52-week savings challenge.
One of the most common excuses Canadians have for not saving is thinking they don’t have the funds to do so. However, ‘saving’ is more about the money you spend, versus the money you make. By adjusting your spending habits over the course of a year, you’d be surprised how much a dollar here and two dollars there can add up. That’s where the 52-week savings challenge comes in. In week one, you put $1 away, week two $2, week three $3, etc.—all the way up to $52 in week 52. By sticking to that simple challenge you can save $1,378 by the end of the year (because when there is an actual number attached to a financial goal, there’s more of an incentive to work towards it). Plus with financial literacy being a huge part of the curriculum you teach, you could even bring your students in on the challenge, adjusting the timeframe to coincide with the amount of weeks in a school year.
Click here to see how you can save up to $500 a month.
5. Partner up to achieve your savings goals.
They say all good things come in pairs. That’s doubly true when it comes to saving for financial goals. If you have a husband, wife, or partner, it makes sense to take on your financial goals together. Because nothing achieves financial goals faster than dividing and conquering said goals as a couple. Plus it can make it a lot less painful to make those initial budgetary sacrifices in the beginning when you’re both there to encourage and support each other every step of the way.
Need some guidance to get your financial goals kick-started in the right direction? We’re here for you.
Since 1975, Educators Financial Group has helped thousands of education members achieve their financial goals at every stage of their career and beyond.