David Lerner Associates: 5 Ways to Improve Your Personal Bottom Line in 2016
Many Americans are taking stock of 2015 as the end of the year approaches. According to a new study by Capital One, only 34 percent of Americans feel they accomplished some of their financial goals this year. So while we may be relieved to see the back of 2015, here are some tips that can help you improve on meeting your financial goals next year:
- Create a plan and stick to it. The Capital One study shows that only 17% of Americans have a budget. When you have a plan written out and you have agreement in the family to stick to that plan, it helps you to stay on track. Use a digital tool that can help you track income and expenses. You can see a list of tools here
- Change your spending habits. Once you have tracked all your spending, it’s likely you can see ways to cut back. Do you really need that $4.00 latte every day? Could you do a DIY project instead of buying an expensive item in a store? For example, a new kitchen island could cost as much as $2,500. By finding a sideboard in a thrift store, painting it and putting a butcher’s block on top, you can create one that has character, is unique, and costs a fraction of the price.
- Set up an emergency fund. 60% of Americans experienced an economic shock recently, such as a drop in income, a hospital visit, the loss of a spouse or partner, and a major car or house repair. We all like to think positively, but it is wise to prepare for the worst. If you’re living paycheck-to-paycheck with no emergency fund, a major economic setback could be a disaster for you and your family.
- Start paying off your credit card debt. The average U.S. household has about $15,000 in credit card debt. One of the major reasons for this increase in debt is that the cost of living has outstripped income levels over the last 12 years. The cost of this credit card debt is often not taken into account, and according to NerdWallet, the average household is paying a total of $6,658 in interest per year. Start by paying off the card with the highest interest rate. Then move on to the next highest and so on. Remember to make all card payments on time, as late payments result in extra fees and affect your credit score, which can raise your interest rate.
- Think about the future. The concept of “pay yourself first” is the core of many financial books and strategies. Talk to an experienced retirement and investment advisor and figure out what you’ll need and how much you should be saving each month. (You can use this calculator too) If you leave it until you’re in your 40s or 50s, it will be more difficult. Starting early means that saving a small amount each month can grow over time and create a nice little nest egg for retirement.
Get together with your family before the end of the year and work out a plan for 2016. If you implement it, this time next year you’ll be celebrating more than just the holidays.
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Founded in 1976, David Lerner Associates is a privately-held broker/dealer with headquarters in Syosset, New York and branch offices in Westport, CT; Boca Raton, FL; Teaneck and Princeton, NJ; and White Plains, NY. For more information contact David Lerner Associates Call 516-921-4200 Visit our website: www.davidlerner.com