Many people’s resolutions for 2018 will revolve around their finances, but what are some of the most popular financial resolutions for the year ahead?
With the New Year nearly upon, it’s once again time to reflect on our lives and start thinking about what we’re going to do differently in 2018. With slow wage growth, rising inflation and increasing levels of personal debt in many countries around the world, there’s no doubt many people’s resolutions for 2018 will revolve around their finances. But what are some of the most popular financial resolutions for the year ahead?
1.Organise your key financial documents
That might not sound like the most exciting couple of hours you’ll ever spend, but many are people are deciding 2018 is the time to stop putting off this essential admin task and start arranging their key financial documents into some semblance of order. That includes things like pension documentation, savings accounts, insurance and mortgage documentation and more. It’s also important you make sure family members know where this essential financial information can be found.
2.Pay off debt
Although many workers are hoping for a pay rise next year, the forecasts show most are unlikely to receive an increase much above the rate of inflation. Salaries are predicted to rise by 2.8 percent in 2018, with inflation currently coming in at 2.6 percent. That means, in real terms, most can expect their spending power to remain flat. However, despite the stagnant wage growth, many people still plan to pay off a big chunk of their debts in 2018. Refinancing is always one way to lower your repayments while a balance transfer can help you get ahead on interest costs.
3.Build an emergency fund
South African lender Wonga recently surveyed its own customers and found that the most popular resolution was the desire to build an emergency fund. This can help you save for goals in the future or be a buffer you can dip into when necessary to avoid using credit cards or accessing short-term loans. An emergency fund should be able to sustain your family, that means pay essential expenses such as rent or mortgage payments, utilities, council tax and food, for three months.
4.Save money every month
The best way to save money is little and often, whether it’s paying into a savings account, a private pension or putting some money aside to help you reach a long-term financial goal. Even if you can only afford to save a tiny proportion of your income every month, it will soon add up.
5.Check your credit report
One thing we should all be doing frequently is checking our credit report. Not only does this allow us to see how our spending behaviours are impacting our credit score, but it’s also an effective way to identify any errors which might be increasing our cost of borrowing. It can also help to spot attempted fraud. If you do see a negative mark on your credit report, make sure it is resolved. You should also close any accounts or credit cards that are not in use.
What are your financial resolutions for 2018? Please share yours with our readers in the comments below.