2021 Financial Inventory

I’m sure you’ve come out of 2020 with new thoughts, and realizations of your life, possibly different types of expectations and goals.  Some may stay as is, while others change some, and others still, change completely.  Last year was an eye opener for all of us.  We never planned or thought we could do some of the things we were mandated to do, by our state laws.  These things were done, of course, to keep us all safe from getting a deadly virus.  In doing so, we learned that we can, in fact, work from home, children can learn remotely, and we can live with less because we don’t make numerous stops to pick up groceries or browse through stores.

We learned to simplify…. meaning we spent less!

So, while the year is new, make an inventory list of things you want to accomplish financially. Make realistic goals so you don’t get overwhelmed and then give up.

Set up a Budget. Make a list or spreadsheet of your income and recurring monthly expenses, add in occasional incidentals, and the annual bills… Whatever amount is remaining, save.

Save. Save something from each paycheck. Choose a reasonable and workable amount that fits into your budget. Make it be the first ‘deduction’ out of each paycheck.

Gather bills for any outstanding debt, and work as diligently as possible to paying off one bill at a time.  Pick the bill with the highest interest rate, and work on that one first until it has a zero balance. Do not neglect any other bills….pay at least the minimum on any other bills, and when the first balance is paid off, continue in the same manner on the second and so forth.

Audit your checking accounts monthly.  Make sure your balance agrees with the bank.  And if not, reach out to them and go over your figures with theirs.  Balance the account(s) to the penny.

Scrutinize your bills. Whether you get a paper bill in the mail, or do your banking online, go over your accounts line by line to make sure you, and not someone else, purchased an item listed on the bill.  If there is a discrepancy, call Customer Service  and immediately resolve it.

Begin (or continue to add to) your Liquid Emergency Savings,  and the 9-12 month Cash Reserve Account.  And don’t neglect putting all you possibly can into your Retirement Account(s).  If your budget is already extremely tight, start saving for the Emergency Savings first, as it is the smallest.  Then work on the 9-12 month Cash Reserve.  Once you make it to 6 months of reserve, continue on, but make part of the savings figure go towards a Retirement Account. This will at least get one started.  The earlier you start, the better.

It may seem an ominous goal at first, but with consistent and as diligent savings, as much as you possibly can do, you will begin, then continue to see small results, then as time moves on, you’ll see zero balances on what was outstanding debt, and you’ll see savings accounts grow.

All this does take time, but with discipline on your part, it will pay off for you in the long run.

You can do this!!