Save money with these personal finance New Year's resolutions
MINNEAPOLIS — 2023 was full of ups like inflation and record highs on rates for credit cards. It has also had downs with shrinking wallets and declining savings.
While everyone's financial goals are different, money is on the minds of many Minnesotans.
"I'm trying to save," said Jordan Cully of south Minneapolis.
"Budgeting is horrible for me. That's the thing. Inflation is really bad but part of it is taking accountability," said Jay Colenburg of Minneapolis.
Forty-eight percent of Americans say they are likely to make and keep a resolution to manage their money better or save more in 2024, according to an Allianz survey.
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This is the time to take a fresh look at your finances.
"Use this time to not judge what may have happened or didn't and think proactively about what you might be able to learn and apply to the future," said Brian Eder, founder and partner at Northwestern Mutual's Voyage Wealth Architects.
Eder says while it's never been easier to track where your money goes, it's also never been easier to spend it.
"As tedious as it is, one of the things that helps our clients the most, and these are clients that all walks of life. You just have to download the transactions and you've got to go through them one by one and make them into categories," said Eder.
For those who really want to get serious on budgeting, try going all cash.
"You literally take out a pile of cash for the month and you go through it. When you have to hand that cash over at the checkout, you think very differently about those purchases. Every time we do this, it results in probably a third to 40% less spending in a month," explained Eder.
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Cully has switched to cash and a 100-day envelope challenge to save more money.
"Every time I get cash, say I have $50, I'll put $5 in the $5 envelope and then $10 in the $10 envelope and kind of save up," said Cully.
The third strategy is reviewing insurance policies and understanding your costs.
"What are my deductibles, what are my limitations and if you're not sure, it's OK to reach out to your agent and request a review meeting or go find an agent that can help you," said Eder.
Whatever you do to get on the right financial path this year, Eder says it boils down to one thing.
"Learn to live within your means. It's by far the best piece of advice I think anyone can ever give," said Eder.
Eder says there are some common mistakes to avoid when trying to improve your personal finances.
Two big ones are setting unrealistic goals or forgetting about them.
And for investors: not taking advantage of IRS limits for 401Ks and profit-sharing plans.
