We’ve all been there. You start the year with high hopes, ready to pay down debt or save for the future, but life happens. Suddenly, the money you planned to set aside every paycheck becomes every other paycheck, and eventually, the goal fades away. It’s not a lack of discipline; it’s just that big, vague resolutions are hard to keep.
Start small with your savings
As an ancient Chinese proverb notes, "a journey of 1,000 miles begins with a single step."
Nobody wakes up one morning ready to run a marathon. You start by jogging a few minutes, working up to a mile, and eventually, you conquer 26.2 miles. Your money works the same way. Don't resolve to save $1 million overnight. It's too easy to get discouraged.
Start by having just 1% taken out of your paycheck for your employer’s 401(k).
Let's look at the numbers. Suppose you make $60,000 a year. That’s $50/month, or just $25 per paycheck if you’re paid twice a month. You will barely notice that $25 is missing.
In a couple of months, bump that to 2%. That's another $25 per paycheck. Then move to 3%. Every time you get a raise or a bonus, bump it again. One day, you'll realize you're saving 10% or more of your salary, and you'll be surprised how much you have accumulated after a few years.
Get your financial house organized
The simple act of getting your finances organized creates peace of mind. It saves you time and helps you make smarter decisions.
This doesn't have to be complicated. You just need to follow three steps: follow the advice in this article, look at future milestones, and tackle one thing at a time. By doing this, you'll gain a complete picture of your taxes, insurance, and assets. You'll feel more in control of your money than ever before.
Align spending with your values
One of the keys to financial happiness is aligning your finances with the things that are most important to you. This doesn't mean saying "no" to fun. It means saying "yes" to the things that matter.
It means saying yes to peace of mind and the future you want. To do this, you need to track where your money goes. Use a pencil and paper or an app, but follow your income and expenses for a couple of months. You might be surprised to see where it all goes. Once you have that info, you can decide if your spending reflects what you truly value.
Get on the same page with your partner
Managing money in a partnership can be challenging. It isn't always romantic, but getting on the same page is crucial for a healthy relationship.
The first step is understanding the psychology of money. We all absorb lessons from our parents as children, even if we don't realize it. Taking a simple quiz can help you uncover those lessons.
Once you understand what money means to you, it’s time to understand your partner's feelings. Learn where they are coming from so you can make financial decisions together that work for both of you.
Teach the next generation
One of the most important things parents can do is teach healthy money habits early. Children start learning money habits from you by the age of three. By age seven, they have already formed many of their attitudes about money.
Start simply. Take your children to the grocery store, open savings accounts with them, and have age-appropriate discussions about earning and giving. Teach them the value of delaying gratification by saving up for larger purchases.
Once you’ve done this, you’ll have answers that will help you succeed in the coming year. You'll know which decisions worked, which you'd change, and what you've learned to make smarter decisions in 2024. So start small, get organized, and enjoy the financial life you deserve.
The Facet difference
At Facet, we believe financial planning isn't just about investment returns; it's about improving your entire life. That's why we pair you with a dedicated CFP® professional who works with you to build a personalized roadmap. We don't charge asset-based fees that eat into your growth. Instead, we offer a flat membership fee that makes comprehensive advice accessible. We're here to help you achieve self-fulfillment and ensure your money is a true reflection of your values.
