Schools have reopened their doors and are in full swing, restrictions have been lifted in the travel industry, businesses are operating at full capacity, vaccines are available, and masks are quickly becoming a thing of the past. There is a general sense of fresh starts in the air. We are all in the midst of reflecting on the past year and a half. We have all acquired new experiences and have learned many things about ourselves, others, and the world – in general. Now, it is time to use those experiences and lessons and start fresh. One of the best places to start is your finances. Now is the time to reshape your future and setting new financial goals will help you achieve success in this endeavor.
Confronting Debt
If you are reading this, chances are, you have some degree of debt. It may be your mortgage, a home improvement loan, a personal loan, or credit card debt. During a global pandemic and similar types of emergency situations, it may prove to be exceptionally difficult to just pay on your home, utilities, and put food on the table. When you add debt to the mix, things get even more complicated. Why continue to weigh yourself down with debt when you can resolve it and move past it? Simply start by creating a list of all the debts that you have.
When creating the list, outline the interest associated with each debt as well as the balance. Now, you can handle the debts in one of two ways:
- Make a point to pay down the smallest balances – regardless of interest rate. This will help you achieve progress faster and will motivate you to continue.
- You may also choose to pay down the debts that charge the highest amount of interest first. Most financial advisors recommend this course of action as it will save you money, over time.
Once you select one of the steps above, you should choose at least one of the debts being handled and add a small amount of money to it each month. Let’s say that you pay $60 each month to a credit card. Add an additional $20 to that to make the total monthly payment at least $80. In doing this, it allows you to save interest on that credit card and get the balance paid off much more quickly. As you pay off debts, continue adding small amounts to your minimums to make the process go faster and save yourself some money.
Organize Your Finances
The next step in setting new financial goals is to organize your finances. This will help in the control of your money and the achievement of all of your future financial goals.
Organization techniques that are highly effective include creating a budget, tracking all that you spend on, and making a bill pay system that ensures all bills are paid each month and on time.
You should also create a file for statements and carefully monitor each of the statements every month to determine if any unusual spending, fees, or other activities show up. If you notice any mistakes or unusual activities, correct them immediately.
Set Up a New Savings Account
Now that we have experienced layoffs, business closures, shortages, and a global pandemic that really had a detrimental effect on finances, we know and understand the importance of an emergency fund.
To establish this type of fund, open a new savings account at your bank. Once you open it with the minimum amount required, decide how much you are able to regularly contribute to it. Even if it is as little as $25 or $50 a week. Have that amount automatically withdrawn from the checking account that you have and placed into the new savings account. Once you reach a level of comfort with that amount, up it a little more.
Keep doing this at regular intervals.
Be certain that you avoid spending it unless absolutely necessary. Also, make sure the savings account is an interest-bearing account so that your money makes money.
Protect Your Money
These days, the most common type of financial transaction is the electronic transaction. You should take every step possible to proactively protect your money. This means protecting your identity, your credit card numbers, your bank account numbers, and the statements associated with your financial accounts.
When you are done with your statements and are ready to throw them out, shred them first. To avoid paper statements, sign up for electronic statements. Monitor all of your statements and your credit report regularly. If you see anything out of the ordinary, report it immediately and correct the issue.
When creating passwords, make sure you use a combination of upper- and lower-case letters, symbols, and numbers that are difficult to guess. You should also make certain that you change these passwords on a regular basis. Never use your physical address, mailing address, birthday, Social Security number, driver’s license number, age, or other information that may be easy for scammers to guess. Always use unique combinations. The more difficult the password, the more difficult it will be for fraudsters to illegally obtain your information.
Contact Us Today
We here at Somerville Bank offer many products and services that will help you effectively manage and protect your finances. We offer online banking, mobile banking, checking accounts, savings accounts, mortgages, loans, and more! If you want to take charge of your finances, we have financial experts and advisors that are standing by and willing to assist you. You are sure to discover that one of our low-cost products and services will help you on your way to financial freedom. We also offer an above-average return on investment for our shareholders, high-quality opportunities for those seeking employment, and even community services available in our market. If you would like to learn more or require any other type of assistance, contact us today at one of our many locations: https://somervillebank.net/locations/
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