2020 Financial Resolutions
Resolution-making is in full force for 2020. Resolution-keeping? Well, you’ll have to wait until the end of the year to see how you performed there.
If you have a financial resolution for this year, you’re not alone. A recent survey indicated nearly one-third of all Americans had a financial resolution in 2019 and the good news is nearly three-fourths of them stuck with it. That means if your resolutions include something financial, there’s a good chance it can be a successful one in 2020.
One reason that’s the case, said Cindy Neely, manager of the Park National Bank Main Office, is the benefit of creating an automated plan that includes your financial goals for the year. It’s a one-time deal and once you align your goals, your automated plan goes to work, allowing you to get a step closer to your financial resolutions each day. With an account with us, you can easily set up your automated plan through online banking. From there, you can transfer money automatically into your savings, set up automatic bill pay and create account alerts, putting you on a streamlined path to meet your goals.
“If you focus on your finances and within 30 days you’ve got it rearranged the way you want, you could be set for the entire year,” Neely said.
The start of the year is the perfect time to perform your own financial check-up and get your goals arranged the way you want.
Do you need to save more? Do you want to pay down debt? Do you want to spend less?
Those are the top three financial resolutions among Americans in 2020, but the first thing that must be in order is a budget. If you don’t already have a budget in place to track your spending, it’s an imperative part of reaching your goal.
In fact, if someone doesn’t have a budget it’s the first place to start. There are a multitude of apps to help you budget or you can go with a trusty Excel spreadsheet. Our online banking service and mobile app provide an easy way to monitor account activity so you maintain your budget, you can also set up account alerts if your budget falls below a certain level, and create spending controls.
Creating and maintaining a budget lays the groundwork for your financial goals. Without it, your financial resolutions may quickly go by the wayside.
“For example, you may continue to have credit card debt because you spend $200 a week eating out and you don’t even realize that or even aware of it,” Neely said. “The first thing we help figure out for someone is a budget.”
It’s a key period to assess and understand where the money is going, allowing for quick adjustments and can free up money for the next two items: eliminating debt and saving more.
Once the budget is completed or updated, a common next step is debt consolidation. A lot of clients look to streamline any debt they have at the beginning of the new year, especially as the previous year sometimes ends in chaos with holiday spending.
Interest rates are an ideal place to start when it comes to eliminating debt in a smart, cost-effective fashion. You may want to pay off the lowest debt amount you have, but that may also have the lowest rate. In that instance, the better decision is to focus on the payment with the higher interest rate and focus on lowering that overall amount.
Of course, if the remaining balance is low enough that it can be paid off quickly, it may give you peace of mind to eliminate that payment, adding that part of your budget into another payment.
“It’s almost like a puzzle and we have to figure it out what the client is looking for and what they’re comfortable with,” Neely said.
That’s one major benefit of working with our bank. Everyone has different goals, but our bank doesn’t offer cookie-cutter options, only a variety of solutions to feed every person’s needs no matter their current financial situation.
“Our job is to answer the questions and piece it together so it works for them,” Neely said. “That’s what is nice about our accounts and services.”
Saving more remains the major financial resolution for most Americans, with the majority aiming to put away an extra $200 per month. That relates to the biggest trend – saving for long-term goals – but again goes back to having a plan.
With that in mind, think about a “Divide and Conquer” approach. Instead of budgeting all of your extra money to paying off a debt or using it solely to save more, a wiser approach may be a little of both.
A valuable tool is transferring a set amount into your savings account automatically. That way it helps you save and you don’t have to think about it. With online banking, you set the amount that transfers every week, every other week or once a month, and the money goes into your savings directly.
It’s a valuable step for budgeting, and your financial resolutions and your future self will thank you for it.
Add in the benefits of our checking account and mobile app, and you’re fully armed to keep your budget headed in the right direction on a day-to- day basis.
It’s also common to have multiple checking accounts, using one for certain bills, another one used as a primary hub for most of the money and day-to-day/daily spending, and then a true savings account where money is automatically transferred on an automated basis. It can be an efficient way to budget money where it needs to go without being tempted to spend money you don’t need to touch. It’s also a good option for families if there is one primary person who handles the finances.
Having an account is beneficial in a number of ways. It’s easy to monitor account activity, create and manage real-time alerts, schedule recurring transfers into your savings, and set up regular bill payments. Add in the ability to transfer money between accounts, the convenience of online and mobile banking, and it’s a great automated system for financial success in 2020. With your budget set up and an automated plan of action in place, it’s time to nail that financial resolution this year.
“Every year people want to save, consolidate debt, and try to do better with their finances,” Neely said. “There are more tools now than ever and technology can help you.”
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