The start of a new year brings a wealth of possibilities, key among these is the opportunity to take control of your finances and build healthier money habits. With rising costs, unexpected expenses and economic uncertainties following the passage of Hurricane Melissa having a clear plan can make a significant difference to your financial outcomes, according to Rose Miller, financial education consultant at the JN Foundation.
She recommends this seven-point New Year financial checklist that will provide practical steps to help individuals and families set realistic goals and make smarter financial decisions throughout the year.
1. Review Last Year’s Spending
Begin by looking back at your spending habits and expenses from the previous year. Pick out areas where you may have overspent and identify ways to reduce unnecessary spending. Understanding past habits is a great first step towards change and improvement.
2. Create or Update Your Budget
A budget is the roadmap for managing your money. List all sources of income and outline monthly expenses, ensuring essentials such as rent, utilities, transportation, and groceries are included. A consistent and disciplined approach to this exercise will be highly rewarding.
3. Set Clear Financial Goals
Define what you want to achieve financially in the coming year. Goals may include building an emergency fund, reducing or paying off debt, saving for education, or starting a small business. Whatever the goals, be realistic, not only with each goal but also about the timelines for achieving them. And remember, track your progress regularly.
4. Prioritise Saving
Make saving a non-negotiable part of your financial plan, by making it a fixed expense. Aim to save a percentage of your income consistently. Start where you can even if it’s small, the outcome at the end of the year will surprise you. To increase your chances of success and build discipline, automate the process by having the funds transferred directly to your savings account
5. Build an Emergency Fund
Unexpected expenses can disrupt financial stability. Strive to save at least three to six months of living expenses this will improve resilience and help protect you and your family from financial shocks.
6. Tackle Debt Strategically
Review outstanding debts and focus on paying down those with highinterest first since these are more costly. At the same time, avoid accumulating new debt unless it is absolutely necessary.
7. Plan Before Spending
Avoid impulse purchases by planning and remaining focused. Create shopping lists and spend according to the limits of your budget. Do not be swayed by attractive deals which can easily railroad your plans. Be intentional when you spend, always bearing your goals in mind.
“Revisit your financial plan every few months to assess progress and make adjustments. Life changes, and your financial plan should adapt accordingly,” Mrs Miller recommends.
She emphasised that the journey to financial security is never an easy one, but starting the year with a financial check-up and a checklist can help turn intentions into action. “With planning, consistency and discipline, the new year can be a giant step towards greater financial security and peace of mind,” she pointed out
