A new year brings a fresh start, especially when it comes to the pocketbook. Wouldn’t it be nice to get rid of your credit cards, make a killing in the stock market, or buy your first home? According to the Fidelity 2014 New Year Financial Resolutions study, 54 percent of Americans said they “typically consider resolutions concerning their finances.” This year, instead of struggling to maintain your resolutions come February, consider taking on these simple money resolutions that you can actually keep.
Three Simple Money Resolutions you Can Keep
1. Start Investing
Investing can seem scary, but how does it work? What is a 401(k) plan, or IRA? Perhaps this fear of the stock market causes us to promptly do nothing when it comes to our future. According to a study by Wells Fargo, 37 percent of Americans are on a work-until-you-die retirement plan. For 2014, if you have never invested before, set a goal of just giving it a shot. Time is money — and that is also true of investing. Albert Einstein said, “The most powerful force in the universe is compound interest.” The younger you start investing, the longer your money has to compound, and the better off you will be in your retirement.
2. Stop Borrowing
Tired of all your bills? If you want to kiss your student loans, car loans, or credit card debt goodbye, you have to start somewhere. It can be overwhelming trying to figure out where to start or what to tackle first. It may be out of reach to have everything completely paid off in 2014. But the best place to start when it comes to getting out of debt is to stop borrowing money. If you owe money on your credit cards, stop making new transactions on your cards. When it comes to making larger purchases like electronics, appliances, and furniture, avoid taking out any loans on these items, including zero-interest deals where you pay for the item for months to come.
3. Know the Numbers for Buying your First Home
Don’t just dream about homeownership — put the pen to the paper and figure out a few important numbers. The American dream of homeownership became the American nightmare with the mortgage crisis that resulted from too many people buying homes with little to no down payments. After millions foreclosed on their homes, banks now have stricter lending requirements. According to bankrate.com, about 30 percent of prospective homebuyers who apply for a mortgage are turned down. If you want to buy a home in the near future, start by figuring out first a reasonable price range for homes you can afford, and then calculate how much of a down payment you will need.
This is the year to start investing, stop borrowing, and get a plan to make homeownership a reality.
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