Every January should be a time to consider where you are financially and where you want your financial future to go. We should always be challenging ourselves to become more financially responsible. Yes it is like the New Year’s resolution, but the results can affect you the rest of your life.
Let’s set you up for success for this upcoming year. Look at each month as an opportunity to improve your financial responsibility. Do you start planning for your retirement? Or maybe you have children and you want to start a Registered Education Savings Plan (RESP) . Whether it’s planning for the long-term end goal, or trading in your old vehicle for something new to you, planning is essential to achieving those goals. The challenge is to take each month and give yourself a financial benchmark.
Your New Year’s Financial Challenge
Overall budget review. Do you notice any leaks in your income? If so, come up with a plan to stop it. Is now the time to reduce your budget for buying lunch? Take some steps the night before to get organized and pack a lunch. Maybe it’s time to add up how much that morning coffee is really costing you.
Look at investing more money into your RRSP before the February deadline. Try and complete a mock tax return sometime in February. This will give you a good oversight on what you owe and how you can better your refund.
Break up the winter woes with a vacation. If you plan for this at the same time of the year, each year, it gives you a good idea of how much you have to save each month. If you can find $100 a week to save from November 1st to March 1st, you’ll have enough for a pretty great March getaway.
Tax Returns. Review the February RRSP goals you recently made to make sure you at least break even with the tax man. Try and find ways to increase your refund amount. Make sure you check the CRA website for any tax changes that affect the current year.
Build your credit. Get a free copy of your credit report once a year. It’s always beneficial to ensure all of the information on your report is correct and avoid any nasty surprises. If you’re planning any big purchases this year, see if there’s anything that needs to be fixed or updated prior to letting a lender look at your report.
It seems like everyone and their sister has a June birthday. Summer BBQs are starting and the backyard get togethers are ramping up in full force. If you know you’re going to have five birthday parties throughout the course of June, plan your finances accordingly. Is there a gift you can order online in advance? Can you make something for the party instead of a gift (make sure to add that into your grocery budget for the month).
Is the half year mark. This is the time to pat yourself on the back for your progress so far, and keep pushing forward. Revisit your monthly spending on items like your phone, internet and cable. See if there’s any room to minimize those costs with your provider, or see if it’s time for a new provider altogether.
This may sound strange, but August is the perfect time to start planning for Christmas. You can be shopping little bits at a time from August until December, or you can put money aside each week to save for the December spending. No matter which way you do it, the important part is that you’re prepared and not putting everything on credit for your future self to worry about.
Plan for your retirement. It’s like back to school for your finances. Think about your long-term plan and see if there’s anything that you can tweak to help you retire earlier. The steps you take today, help you threefold in the future.
Get ahead on your financial knowledge. See if there is anything new in finance this year. Are there new TFSA rules, or new mortgage rules? If you’re considering buying a home in the near future, these are things you’ll need to look into.
Just shred it. It is great to start the New Year with a clean house and no paper clutter. With the ability to get bills and pay online this challenge is getting easier every year. If you have bills or paperwork that typically come in the mail, scan it and save it.
Evaluate your past year. Look at what you missed and plan for the next 12 months.
Get Started Today
Your list may not exactly match what we have above. Everyone has something different that works for them. The important piece is that you take time each month and try to improve your financial situation. This will set yourself up for a financially responsible year.