Financial Resolutions – Introduction
New year’s resolutions. We all love making them. We also love breaking them the second week of January. As the year starts, our levels of optimism go up. We proclaim and declare that the new year will be the year of our breakthrough. Only a few people achieve their new year’s resolutions. In this article, I will focus on a number of important financial resolutions we should all focus on this year. Implementing them will help you improve your financial position and the quality of your life.
#1 – Saving for Retirement
Most young people don’t like hearing about retirement. They don’t see the logic of investing a tiny amount of money per month to cater for their retirement. They see it as a waste of time and money. They assume that they will start investing in their retirement later in life. However, the fact of the matter is that the earlier you start saving for your retirement the better it is for you. At a young age, you don’t have a family to take care of. You live in a small house, paying very little in rent. You have one car. You are healthy which means that you don’t pay a lot of money on health-related issues. Therefore, saving for retirement during this time will help you have more money by the time you retire.
#2 – Pay of your Debt
As a young person, you probably have two debts; credit card debt, and college debt. Credit card debts help you to buy items that don’t have a very long-term view. Many people take credit card debts to pay for their monthly shopping. Credit companies on the other hand charge interest rates in the double digits. In the long-run, these interest rates can have a serious challenge on your finances. The earlier you pay the debts the better it is for you. T
#3 – Cancel Subscriptions
This is a financial resolution you can take care of today. In the internet, there are thousands of companies offering various services and products on a subscription basis. They offer the services promising a free monthly trial for the users. The fact is that most people forget to unsubscribe to these services before the month ends. As a result, your card is charged on a monthly basis for services you don’t need. Do you really need a box of ingredients per month? If you are not a music junkie, do you really need a streaming subscription? Cancelling the subscriptions can help you save a considerable amount of money. Better still, you can channel the savings to an investment account.
#4 – Long-Term Disability Insurance
As a trader, your career depends on staring at charts and making a decision based on the market conditions. If you are a full-time trader, purchasing a long-term disability insurance can help you in case of an accident. This is because unless you have such an insurance cover, chances are that your career will be affected if you are involved in an accident. The benefit of this is that most disability insurance covers are usually very cheap.
#5 – An Emergency Reserve
As I have written in the past, trading is a risky business. People lose money all the time. To stay safe, you need to have some money in your account for emergencies and bills. This year, purpose to have a good emergency reserve. This will help you have a fallback plan in case your trades goes in the wrong direction. Remember that in trading, you will occasionally make losses. Everybody makes losses at a point in time. Therefore, boosting your emergency plan will help you be financially safe.