Less worry about money is a great gift to give yourself this holiday season. See what you can do today to worry less about money next year. Make 2019 your year for more peace and less worry.
Solid advice for anyone
If you can change something, don’t worry about it. If you can’t change something, don’t worry about it.
When you find that you have money concerns, seek good advice. A good place to start for unbiased financial information is the Consumer Financial Protection Bureau (CFPB). This bureau is a U.S. government agency created to ensure that banks, lenders, and other financial companies treat you fairly.
Before you take out a payday loan or choose to do a reverse mortgage, for example, visit the CFPB’s website to ensure you’re making the best choice by understanding how these types of loans work. It’s better to think twice before you leap into a loan that you’ll regret later.
Repaying credit card debt
Seek help if you’re struggling with managing your debt. Many Americans are struggling with too much credit card debt. Nerdwallet reports (as of June 2018) that the average household in the USA carries $15,482 in credit card debt and pays $904 in interest annually. With rising interest rates, carrying debt in 2019, will cost you more.
Popular financial advisors like Suze Orman and Dave Ramsey each have their own preferred methods for tackling paying off credit card debt, but they agree that you need to decide on a plan and stick to it. Choose the pay-off method that motivates you best:
- Pay off your lowest credit card balance first and then move to the next lowest. Your motivation is seeing your debt disappear by starting with the easiest card to tackle first.
- Pay off the highest interest rate credit card first. Your motivation is knowing you’ll save money on interest overall from day one of your pay-off plan.
With either method, consider:
- cutting your spending and using that money to pay down your debt,
- earning more money by finding a better paying job or taking on a side hustle, and
- setting up an emergency savings account funded via auto-deposits from every paycheck.
» Learn more: How Can I Reduce My Debt?
The joy of a nest egg
Start the habit of saving a portion of every dollar you earn. Even if it’s just a small amount, you’ll be happy to have a “set it and forget it” emergency fund when your car breaks down or you need emergency dental care.
$20 saved per month adds up to $240 per year. $50 saved per month adds up to $600. Keep track of the next $240 you spend. Did everything you buy really give you more peace of mind than having some savings for a rainy day?
Sorting out needs vs. wants can be emotionally tricky. But, the process of reviewing your spending honestly really helps you to a) know what you’re doing with your money and b) consciously decide if you’re on track for a healthy financial future.
If you’re not, don’t beat yourself up, just retrain your mind to enjoy working toward a long-term goal that’s important for you.
One reason some people choose to go back to using cash to buy their “wants” in life is because it’s slows down their ability to spend money so quickly. Next time you’re about to reach for your plastic, ask yourself:
Would I still buy this if I had to pay for it with cash right now? Would I find a cash machine or bank to withdraw the money to pay for it?
See if this changes your feelings toward buying whatever it is you’re reaching for. Impulse buys can really wreak havoc on a budget. Become aware of yours for a month and see if it changes your spending habits. Or try using cash for a month. See how much less money you end up spending. If you take the time to test yourself by running short-term money experiments, you’ll gain awareness of how your mind works and more control of your financial life. This can give you more peace of mind in 2019 and beyond.
Schedule a date with your partner to talk about money
If you’re fighting about money with your main squeeze, agree to an amount of money that you can spend without consulting each other. If either of you wish to purchase something above that amount, agree to discuss it before making the purchase or signing up for the subscription or membership. Holding this commitment can help you respect each other’s needs by aligning your financial values together. Over the long haul, this can really save an otherwise great relationship from breaking up.
Ask your spouse on a date to talk about money. Do it in a place where you can’t start yelling at each other or walk out of the room (if that’s your pattern together). Just ask them questions about what makes them feel secure regarding money; what makes them feel insecure. Ask how their parents handled finances in their family. A lot of money issues stem from what didn’t work in our families. Agree that you’re not going to create a budget while on your date, but just talk and listen to each other. See if this can help you to bring more awareness into your financial life together.
Teach your loved ones to save for a rainy day
If you have kids or a baby brother or sister, set up a savings account for them when you start yours. Teach them to save from an early age. You’ll be motivated to keep saving if your loved ones are sharing the experience with you. Just like a work-out buddy keeps you on track, a savings buddy can help you be more financially responsible on a daily basis.
Often people who are financially stable had someone in their life who taught them how to work and save from an early age. Creating the habit of saving is a smart financial move now or anytime in 2019.
Repaying student loan debt
If you’re in your 20s or 30s, you may be struggling to repay your private or federal student loans. Make the repayment process easier on your budget in 2019, by researching options such consolidating your loans into one payment, lengthening the term of your loan, or lowering your payment to match your income. It is better to find a repayment plan that works rather than stopping your payments or defaulting on your student loans.
Help in repaying federal student loans
Research your options for your federal student loans by using the Federal Student Aid Office’s repayment estimator. This online tool asks you a few questions and then calculates what your monthly payments can be adjusted to. It’s an easy way to explore your options before meeting with lenders.
Help in repaying private student loans
If you are struggling repaying private (non-federal) student loans, seek assistance from the Consumer Financial Protection Bureau mentioned earlier in this article.
Have your students loans forgiven
Do you serve in the military or are you employed at a governmental or non-profit organization? If you make 10 years of qualified monthly payments on your student loans, you may be able to get the remaining balance forgiven. You’ll save a lot of money in exchange for doing something good for our society. Learn more about the Public Service Loan Forgiveness (PSLF) Program here.