This post started out as 25 Personal Finance Resolutions to Consider for 2020. However, due to this little personal finance and goal setting personality quick I’ve developed over the years, my list got a little out of hand.
So, I had to break it up into two parts. This is Part I, it includes the quick and easy personal finance resolutions to consider. Each suggestion is relatively quick to implement, yet makes a big impact on your personal finances. Part II, 15 Additional Financial Resolutions to Consider for the New Year, provides even more ideas. They either take a bit longer to complete or are more advanced.
Let’s jump right in, here are 15 personal finance resolutions to consider for 2020:
Contents and Quick Links
- 1 Resolve to do better this next year
- 2 Track your expenses
- 3 Create a budget
- 4 Calculate your net worth
- 5 List all your debt and establish a payoff plan
- 6 Review your credit report and work to increase your credit score
- 7 Research ways to save on utilities
- 8 Lower your grocery spending
- 9 Download savings apps to your favorite stores
- 10 Commit to no-spend days
- 11 Go to the doctor and dentist
- 12 Find a cheap or free exercise program you can stick to
- 13 Subscribe to a personal finance podcast
- 14 Read at least one personal finance book this year
- 15 Write down all your financial resolutions and track your progress
- 16 Recap
- 17 Action Steps
Resolve to do better this next year
This one might seem a little obvious, but if you want to set some financial resolutions for the New Year, it starts with committing to making a change.
Start the year off right by reviewing what went wrong this last year and then identify your top goals for this year.
An easy way to start is to review how much debt you were able to pay off last year and how much money you saved. Before you work on your taxes, review your earned income for the year. How much of that income went towards your debt and savings? Did you want to save more but somehow didn’t manage to? What could have gone better?
Now that you have an idea of what needs to improving, fully commit to making some changes and setting a few personal finance resolutions for 2020.
Learn how to step through a personal finance year-in-review here.
Track your expenses
Just like the suggestion above, this is an essential place to start if you’d like to make some financial improvements this year. Let this be the time that you vow to understand where your money is going.
In order to be successful in your resolutions, you need to be clear about your goal and then you need to take small steps to make progress. All financial resolutions should start with this one step. Track your spending.
There really is no getting around this one. It simply needs to be done. Why, you ask? Because you have no idea where you are going if you don’t know where you are right now.
I highly recommend installing an app on your phone to help you do this. It make tracking super easy to set up, establish, and maintain. Most banks offer income and expense tracking, so you can explore your own bank’s website to start. Another option, which I use in conjunction with my banking app, is Mint.
Mint is easy to set up and free. It also takes care of budgeting, credit monitoring and net worth tracking.
If you prefer writing things out by hand, download my free monthly income/expense tracking worksheet. You can find this, and the workbook that steps you through the process, in my FREE resource library. See the bottom of this post to learn how to gain access.
Create a budget
Once you have tracked your finances and can see where your money goes every month, it’s time to uncover your bad financial habits and resolve to make some changes. Almost all financial resolutions start here.
Again, Mint is a great resource for creating your monthly budget. You can also download my Monthly Budget Worksheet in my FREE Resource Library.
There are a few ways to go about analyzing your budget and resolving to make some changes. Think long and hard about how you want to start integrating change into your spending habits.
Some people are all-or-nothing about their resolutions. This is how I work. However, be super cautious. I tend to get all excited and I want to dive in and do everything at once with laser sharp focus. This can become exhausting and overwhelming real quick.
As with any goal, it’s often best to take baby steps. Pick one category that needs some spending adjustments. Take a month to make one improvement. Then, find another category and spend the next month focusing on lowering your spending there. One by one, make small changes. By the end of the year, even with small monthly changes, you will make huge progress.
For further reading on creating a monthly budget, check out The Beginner’s Guide to Creating a Budget You Can Stick To.
Calculate your net worth
Do you know how much money you have? As in, across every account and factoring in all debts? If you don’t, it’s time to find out.
The nice thing about this financial resolution is that it doesn’t take too much time. You can work through this in as much time as it takes you to look up all your accounts. But, what you learn is priceless.
Once you’ve gone through and tracked finances and established a budget, knowing your net worth can be a complete game changer.
For example, you may think you’re doing fine, getting through life, paying all the bills and enjoying a nice home and a great car to drive. You even contribute to your retirement fund every paycheck. But, your net worth is negative. Wait, what? Negative?!? If you have debt, it’s quite possible that your overall net worth is in the red. Which means, regardless of how comfortable you may feel on a day-to-day basis, your finances are not healthy.
Let this be the year that you come to terms with your net worth. Knowing your number can help you define your other financial goals. If you are negative, focus on paying off debt this year. If you want to retire by a certain age and your net worth indicates that you are off the mark, focus on saving for retirement.
Also, as you make changes throughout the year, tracking your net worth can be highly motivating. It doesn’t take much to see this number go up. It helps you stay on track and monitor your progress.
To learn how to calculate your net worth, visit How To: Calculate Your Net Worth – And Why You Need To.
List all your debt and establish a payoff plan
If you happened to calculate your net worth and discovered yours to be a negative number, here’s your resolution to start with. Even if your net worth is positive, paying off debt is essential to saving more money and getting on track to health finances.
Start by making a list of all debt accounts. The main thing I don’t include is any mortgage payments. However, if you owe more on your home than what it is currently valued, you may want to add your mortgage to your list of debts.
Once you have everything listed, decide how you want to attack your debt payoff. There are two methods to choose from, or, you can find a combination of the two methods that works for you.
First, reorder your debt from least to highest amount owed. This is the debt snowball method. Every month, pay the minimum amount due on every bill. Then, apply all the money left over from your budget to the smallest debt. Soon, this debt will be paid off.
The next step is like rolling a snowball down a hill, take what you were paying the first debt and apply it to the next debt in line. As you continue paying off your smallest accounts, you will have more money to apply to the larger accounts and they will get paid off quicker.
Rather than aim to payoff your smaller accounts quicker, you can strive to save more money overall by using the debt avalanche method. Here, you will re-list your debts in order of highest to lowest interest rate. Every month, pay the minimum due on all debt accounts, then apply extra to the account with the highest interest rate.
While this method saves money paid in interest, if your high-interest account is also one of your largest debts, it can take a lot longer to see results. This can feel defeating and lower your motivation to keep making progress.
For more information on how to create your debt payoff plan, visit How To: Payoff Debt – Like a Boss. You can also download a debt payoff workbook, including a handy and visually motivating debt payoff progress tracker, from my FREE Resource Library.
Review your credit report and work to increase your credit score
If you plan to borrow money for anything, it pays to have an excellent credit rating. From credit card options (if you love travel hacking like I do) to the rate your receive on your new rental property loan, a high credit score can save you thousands every year.
So, if you haven’t used much credit or if you’ve made some mistakes in the past, resolve to make this the year that you focus on improving your score.
Start with downloading your credit report and review everything for errors. If you see something that doesn’t make sense, call the helpline and get it resolved.
A few years ago, my identity was stolen. I had no idea until I started a new job and received the results of my background check. There was an address on my file that I had never lived at. So, I pulled my credit report and discovered a host of accounts that were delinquent and not mine! Someone in my same city managed to use my information to establish a premium cable tv package. He was enjoying way more channels than I’ve ever budgeted for in my life!
The surprisingly good news was how helpful the different agencies were in helping me resolve everything. In just a few weeks, my score went from the mid-500’s to the upper 700’s.
Now, I’m finally in the 800’s.
After you check your report, make a plan over the next few months to improve your overall score.
Here are some tips to improve your score:
- Pay down your balances
- Automate your bill pay so that you are never late a payment
- Call your credit card company and ask for recommendations on how to improve your score
- Request to increase your credit limit (assuming you can be financially responsible to NOT use that increase to borrow more
- Keep your balance as low as possible. Aim to pay off your entire balance every month.
- Keep old accounts open, whether you use them or not. Every now and then, I’ll make a small purchase from an old account, then pay it off that month, just to keep it current.
- Pay your balance every month, but don’t pay it off too early. Pay the account balance for the month rather than the total balance at the time that you pay the bill.
Research ways to save on utilities
This is a great category to cut back on spending. Often, it just requires a (relatively) short phone call to your utility company.
Common bills you can negotiate lower rates include your cell phone carrier and cable company. You can substitute your cable package entirely for more frugal options like Hulu and Netflix.
Also, consider changing your cell phone plan entirely by custom tailoring it to what you actually need. Check with your current provider for plan change options, or, check out Google Fi and Republic Wireless. Both are surprisingly tempting options.
Lower your grocery spending
If you think you can save money by cutting back on your utilities, wait until you tackle your grocery spending! I have successfully cut my food budget by $500, every single month. This is huge. Every time I go grocery shopping, I aim to save 25%, just by using my store’s app on my phone.
Once I discovered this tip, I never went back to my overspending ways. And no, I don’t cut coupons and I didn’t change the items that I purchase. I simply minimize my shopping to once a week and follow along with what my store has on sale when I go. That’s it. For example, if chicken is on sale this week, I won’t buy beef.
To learn more about how I cut back my grocery spending, visit 11 Tips To Save Money on Groceries.
Download savings apps to your favorite stores
Similar to how I save an average of 20-25% on my groceries by using my store’s app, there are a lot of brands that have similar savings programs. Here’s a short (and no doubt incomplete) list of what is available, be sure to check the store’s that you frequent.
Couponing or gift card apps:
- Checkout 51
- Coupons.com app
- Cashback monitor
BTW, Rakuten is my newest discovery and I’m in LOVE!! Do yourself a favor, click the link, sign up. Anytime you need to order something online (or sometimes in store as well), head to that store through the Rakuten website. Anytime I order Amazon now, I do so through Rakuten. In just one month I’ve received $25 back, simply for ordering my usual household items.
- Rite Aid
Commit to no-spend days
If you want to cut back even more, try out some no-spend days. Pick a day of the week and commit to not spending a dime on that day. If you survive one day, try adding another day. Little by little, you will form the habit of spending less and making more methodical spending decisions overall.
If you are the all-or-nothing type, go for a no-spend month. I haven’t tried this yet, but I have to admit, I’m intrigued and would like to try it out this year. Much of my day-to-day spending is based on habit rather than need. The more focused I am on saving, the less inclined I am to make impulse and habit purchases.
The point of a no-spend challenge is to break that habit of spending unnecessarily. Because often you didn’t really need that soothing lavender shampoo and conditioner set you saw at Target, or the matching lilac colored towels.
Go to the doctor and dentist
Going to the doctor and dentist regularly saves you money in the long run. This is why large HMO’s push for preventative care, the more often you are seen, the cheaper your healthcare costs will be as you get older. Additionally, under most health insurance plans, preventative health appointments are free.
So stay on top of your health now. If it’s been a really long time since you’ve seen your health care professionals, make a point to set up your visits this year.
Find a cheap or free exercise program you can stick to
If fitness or weight loss is on your list of New Year’s Resolutions, do yourself, and your bank account, a favor, don’t join the gym! (Unless of course you are in the habit of using a gym, in which case, fitness and weight loss probably aren’t on your list of resolutions!)
There are so many free, or super cheap, options available these days. Running, or just walking if you’re starting out) is free and can be done anytime and virtually anywhere. My favorite option is high intensity interval training (HIIT) workouts in my own home. I subscribe to Daily Burn for just $15/month. This is a huge improvement over the $90 I was paying for my gym membership or the $170 I was paying for CrossFit membership.
Other inexpensive or free options are Fitness Blender or even YouTube fitness videos.
While I do miss the company of workouts at my local gym, or the team and competitive nature of CrossFit, I’m able to save so much money now. And my workouts are every bit as difficult as before. It came down to priorities. My financial health and goal of financial independence are simply more important, and it doesn’t take a lot of money to get, and stay, fit.
Subscribe to a personal finance podcast
A little over a year ago I gave up my commute. I now bike part way to work and then take the train the rest of the way. I simply couldn’t handle the rush hour traffic anymore. There’s only one thing I miss about my daily commute – listening to my favorite financial podcasts in the car.
I have learned so much by listening to podcasts. My knowledge and ability to invest in real estate is mostly thanks to everything I learned listening to the BiggerPockets Podcast. I discovered the financial independence movement and community from different podcasts, and I became motivated to start this blog from yet another podcast episode I heard.
So much of the financial progress I have made is because of the podcasts I have listened to. Here are some of my favorites:
- BiggerPockets Podcast
- BiggerPockets Money Show
- Choose FI Podcast
- The Epic Real Estate Investing Show
- The Mad Fientist Podcast
- Smart Passive Income
Read at least one personal finance book this year
It may sound like I really love podcasts, but I actually love books even more! Again, I have learned so much from reading about finance. How else do I know everything I write about and teach?
I highly recommend you pick (at least) one personal finance book to read this year. Then, make a point to actually implement a new habit that you learn.
Here are some of my favorites:
Write down all your financial resolutions and track your progress
Now that you’ve made it through the list of financial resolutions to consider for the New Year, it’s time to decide what you want to work on.
Goal success starts with a plan. So, write down the resolutions that you want to achieve over the next year. Make a plan for how you will work on your resolution by breaking it down into actionable steps that you can incorporate into your daily schedule. Then, start tracking your progress. Little by little, even if you only take baby steps, you will make progress. You can achieve your financial resolutions this year!
For further reading on goal success and productivity, check out the following posts:
This completes my list of 15 Quick & Easy Personal Finance Resolutions to Consider for 2019. This is just Part I, I have an additional list of resolutions to consider that either take a bit longer to complete or are a little more advanced than this first list.
Be sure to also check out Part II, 15 Additional Financial Resolutions to Consider for the New Year. Sadly, I just couldn’t list them all in one post, as it was ridiculously long!
Remember, start small and focus on making progress. If you try to take on too much at once, you are much more likely to become overwhelmed and not make any progress at all.
Don’t let that happen! Let this be the year that you take control of your finances and stick to your goals. This can (and will!) be your best year yet.
A quick review of the 15 Quick & Easy Personal Finance Resolutions to Consider for 2019:
- Resolve to do better this year
- Track your expenses
- Create a budget
- Calculate your net worth
- List all your debt and establish a payoff plan
- Review your credit report and increase your score
- Save on utilities
- Lower spending on groceries
- Download savings apps to your favorite stores
- Commit to no-spend days
- Go to the doctor and dentist
- Find a cheap or free workout routine you can stick to
- Subscribe to a personal finance podcast
- Read at least one personal finance book
- Write down all your financial resolutions and track your progress
- Write down a few resolutions that you need to work on for the next year.
- Read Part II, 15 Additional Financial Resolutions to Consider For The New Year. Many of the suggestions in Part II are more advanced or take more time.
- Read the Step-by-Step Guide to Rock Time Management and Productivity in 2019, this will help you plan out how to make progress and stick to your resolutions.
- Break down your resolution into actionable steps.
- Schedule those action steps into your day.
- Find an accountability partner to help keep you on track.
- Good luck! Let me know how it goes by commenting below. Which personal finance resolutions will you make this year?