5 financial goals to set for the New Year

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New year, a new you? The start of a calendar year can be a time for reflection but it’s also a good opportunity to start planning for the year ahead.

This might involve setting goals for yourself - from health goals to personal career objectives. Perhaps you have an aspiration to travel? Want to start a home improvement, or even buy a new car?

There are plenty of things you could focus on to get you motivated for the year ahead. 

However, when planning your objectives for the year, you might find it useful to set some financial goals to ensure you remain on track.

It’s up to you how you set these out but to help you get started we’ve put together 5 simple, actionable goals that might give you some focus on your financials heading into the new year.

  1. Understand your current financial situation


    First of all, it’s important to familiarise yourself with your current finances.

    Being organised from the outset will help you to fully understand your finances so you can figure out how best to move forward and achieve your objectives for the year.

    This could help you to prioritise the areas that need the most attention - whether that’s analysing what you currently spend your money on, or how much money you put away in your savings pot.

    By taking a closer look at your finances, you could start making those all-important improvements to help you get on track.


  2. Creating a spending plan


    Tackling the year one month at a time is a sensible way to approach spending.

    Putting a structure in place, where you can carefully monitor your spending over a manageable period of time – could give you greater control of your finances.

    Working out a spending plan shouldn’t take too long once you’ve fully got to grips with your finances.

    It’s a good idea to look at roughly how much you’ve got coming in each month and compare this to how much you spend on necessities - such as rent, phone bill, car finance etc. By using the difference, you’ll be able to work out how much ‘expendable’ income you have at your disposal each month. This can help you to break down the different parts of your spending plan.

    Planning ahead can also help you to figure out how you can balance your spending throughout the year as you might want to allocate more spending in some months than others.

    Budgeting

  3. Improve your credit score

    When assessing your financial situation, taking a closer look at your credit score is an ideal next step.

    If you already have a respectable credit history, your goal should be more about maintaining that over the next 12 months.

    Aside from the usual things such as making payments reliably and keeping credit utilisation low - there are some fairly easy steps you could take to improve your credit score.

    For example, if you haven’t registered on the electoral roll - it’s probably a good idea to do so. This proves that you live at your current address and helps lenders confirm this information - which is therefore positively reflected in your credit report.

  4. Consolidate your debt

    Managing debt, however big or small - is essential when it comes to setting your financial goals.

    If you’re paying out for a number of different loans or credit cards, consolidating your debt could help to streamline all of your debts into one monthly payment with only one interest rate to consider which could make repayments much more manageable.

    It’s important to consider the best option for you before choosing to go ahead with this type of commitment. If you’re heading into the new year with a long list of things to pay-out each month it could be something for you to consider. To find out more about our debt consolidation loans visit here.

    Family budgeting

  5. Start saving for the future

    For those 2020 goals that include larger projects or goals that require a bit more money, you may want to consider taking a more long-term approach by saving each month.

    By utilising your spending plan, you can work out how much you could afford to save each month to fund your goals later in the year. You could also use your savings in other ways such as adding to your retirement pot or putting money away for the kids or grandkids.

    If you’re disciplined enough to start saving for the long-term - the possibilities are endless.

    If you’re looking for alternative ways to finance your next big project this year you may want to consider a personal loan. To find out more about personal loans read our guide here to see if it’s the right option for you.

    Whatever you have in store for 2020, by planning ahead and keeping on track with your finances, you can get closer to your goals in the best way for you.