In track & field, starting a few meters ahead of everyone else is called cheating. In money management, it's just wise.
You probably have goals for 2024. Health goals. Family goals. Business goals. Financial goals. You could wait until January 1 to start forming good habits that align with your goals, or you could start in December, so your habits are refined by the time January rolls around.
Deal with the challenges of change in December. That way, you've ironed out the wrinkles by January. Here's a few financial habits you can start forming now so that you don't quit on your financial goals by February.
Determine How Much Money You're Going to Save
If you have a good idea of what your 2024 income will be, build an annualized statement of your cash flow for the coming year. Determine how much to spend, pay in taxes, and save during the year.
Though saving is often a good habit alone, take it a step further and determine how much you're going to save for your goals, such as:
Retirement
Home Purchase
Home Renovation
Vacation
Kids' Education
Land Purchase
When you save, you should have a fair idea of how much money is dedicated toward each goal. If you don't, it might be worth talking to a financial planner to help you determine how much you should put toward each goal.
Why you shouldn't wait until January: If you wait until January to start evaluating how much to save, it becomes harder to save the money necessary for your goals. It's difficult to execute a plan if there's no plan in the first place! Life has a funny way of spending your money for you if you don't preemptively decide where it should go.
Schedule a Regular Family Finance Meeting
It could be a particular day of the week. It could be every other Sunday. It could be once a month or quarter. Whatever your frequency, start including your family members into a regularly scheduled financial conversation.
Practice the flow of each meeting. Determine what discussion points you'll hit on. Here are some ideas to get you started:
Weekly spending
Upcoming expenses
Credit card points earned
Investment performance
Updated loan balances
Status of financial goals
Your family financial meeting ensures mutual understanding between you and your spouse. Instead of using your partner's money decisions as an arrow in your quiver during an argument, you can create a healthier dynamic in your relationship that reinforces trust with each other.
Why you shouldn't wait until January: If this conversation is new to you and your family, it's best to do a trial run in December. It likely won't be perfectly in rhythm, and your spouse might take time to get on board with it. However, if one of your goals for next year is to improve your marriage AND your finances, you can begin working on both now so that the habits are formed by the new year.
Improve Your Financial IQ
You may be a DIY financial planner. You may prefer the assistance of a financial advisor. Whatever your preference, understanding how money works is important. If you manage your own finances, you need to know how to make good decisions. If you have a financial advisor, you need to know how to discern the advice you are receiving, so you can continue trusting the team around you.
To get you started, you can view our Financial Literacy Page on the Century Financial website. On it, we describe some of the areas we serve our clients in easy to follow language. It's important to us that our clients are educated just enough about the ways we seek to improve their lives. We believe this builds trust in the relationship.
In addition, you may want to consider financial literature written by some of the great minds in our industry. You may want to follow financial content creators on LinkedIn (I can assure you that you're more likely to get accurate information on LinkedIn than TikTok or Instagram Reels).
Why you shouldn't wait until January: You don't have to read 24 books about the stock market or financial planning by the end of the year. However, it might make sense to start building out a list of resources that will help you enhance your knowledge about money. If you need help finding the right voices, feel free to connect with us.
Write Down Your Financial Goals
Don't just save money to save money. Don't deprive yourself of a $5 coffee if that action doesn't connect to a big picture plan. Don't invest money randomly just because your coworker said you should follow his footsteps.
Think about the course of your life. What do you want to accomplish? Now write down what has to happen financially to achieve that.
Often, it might make sense to consult a financial planner when you have a clear vision in mind, and you need to know what actions you can take to most efficiently achieve it.
Why you shouldn't wait until January: If you wait until the chaos of life starts back up again after the holidays, then you likely will fall back into the same patterns. Though I'd agree with many that a different number on the calendar isn't a significant enough reason to make necessary life changes, there's something freeing and peaceful about starting the new year "fresh," such as a fresh new financial path.
In Conclusion
At Century Financial, we help those in the Memphis area (and elsewhere via web-conference) pursue their financial goals not just in January, but 365 days a year. Hopefully, though, you picked up a few ideas to help start the new year with a clean slate and ready to take on a new set of challenges.
If you'd like to learn more about our wealth management practice or our financial advisor team, feel free to explore our website. If you feel like you could benefit from a second opinion on your financial position, you can schedule a time to meet with us here.
Who is Century Financial?
Century Financial is a wealth management firm located in Germantown, Tennessee. Our financial advisors have about three decades of combined experience in asset management, financial planning, and other related services for clients in the Memphis area and beyond. Learn how you can grow and preserve your wealth with guidance from our team.
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