3 Money Resolutions to Make for the New Year

I always feel full of potential when the new year arrives. It’s a great time to put my money mistakes from the past year (or many years) behind me and start fresh. I love to reevaluate my goals, see where I have succeeded and where I have fallen short, and come up with a sensible money plan my future.

The last year has been a time of crazy ups and downs with my budget, from starting to work as a full-time freelancer, to moving across town for my husband’s job, to shifting my long-term goals to better reflect my priorities. Approaching a new year gives me a chance to really focus on where I am now, and how I want to move forward. If you want to get your financial house in order, here are some great steps to take control of your money in the new year.

1. Track your spending

Maybe you live by a budget, or maybe you’re finally ready to make the commitment for the first time, but in either case, it’s a good idea to take stock of your spending habits as you start a new year. Spend a week tracking your daily spending so you can see exactly where your money is going. I like using a regular old spreadsheet for this, but there are excellent apps, such as Mint, that can help you track every penny with ease. You may be surprised by how often you opt for a quick and easy cafeteria lunch while you’re at work, or by how much you spend on clothing.

I thought I was always really strict with my spending, but as I approached the new year, I realized there were some areas where money was falling through the cracks. Using the vending machine at work racked up a hefty bill, and subscribing to apps and services I rarely used was costing me even more. Taking a long hard look at my money habits showed me where I could cut back while still living comfortably, making my new year look a whole lot brighter.

2. Look at your fixed expenses

Often, when I look to cut costs in my budget, I’m looking at flexible areas like groceries, entertainment, and clothing. However, taking an in-depth look at my fixed expenses opened up a whole new world of savings. From comparing car insurance policies to refinancing my debt, I was able to save a whole lot of money without shifting my day-to-day spending.

This year, make a resolution to shop around for better insurance policies and push for better rates on student loans or credit card debts. We often don’t think of these expenses as negotiable, but they are, and you could be leaving a lot of money on the table! You can save hundreds of dollars while keeping the same coverage, simply by shopping around.

3. Make saving a priority

Saving can be difficult, but we all know it is necessary, so why don’t we do it? Often we think we can’t save money; that there simply isn’t enough left at the end of the month to save. To be honest, that’s true. If we put saving at the end of our list, we will run out of money before we get there.

So when you start the new year, put saving at the top of your list and get it out of the way before any other unexpected expenses hit you. Make it easy to save, by setting automatic monthly payments to come out of your checking account into a separate (and slightly harder to reach) savings account or retirement plan. Also resolve to set aside a certain percentage of any “new money” such as an unexpected bonus, raise, or tax refund, before you start spending. Setting aside 15% of your total income is a great goal to aim for, but if you don’t feel like you can do that, set the bar a little lower. After all, saving some is always better than saving none.

You need to invest in yourself first, so this year, make becoming money-smart a priority!