The IFCU Blog

Consider These Financial Resolutions for the New Year

As we embark on the new year, it's an opportune time to contemplate financial resolutions that can pave the way for success. Here are some practical suggestions to kickstart your financial journey in the right direction.

Resolution: Tackle Debt

Debt can be burdensome, but a strategic plan can make a significant difference. Kick off the New Year by devising a plan to pay down or eliminate your debts. If your current debt repayment method isn't yielding results, consider revising it. Review your budget, identify areas where you can cut back, and allocate those extra funds to expedite the repayment of high-interest debts.

Solutions:

1. Consult with  an IFCU Financial Counselor to receive personalized strategies for your financial goals.
2. Explore alternative debt repayment strategies such as the snowball or avalanche methods. Learn more about these strategies here.
3. Consider a debt consolidation loan to streamline your payments into one manageable installment.

Resolution: Enhance Your Credit Score

Paying down debt goes hand-in-hand with this next resolution: improving your credit score. Make it a goal to increase your credit score this year. Paying down debts will help. But so will monitoring your credit report for errors, making on-time payments, and using 30% or less of your total credit available.

Solutions: 

1. Check your score in IFCU's Digital Banking for free. 
2. Utilize IFCU's Credit Score tool to access your full credit report at any time, without affecting your credit score.
3. Set up Credit Goals inside of Credit Score to receive personalized steps for achieving your credit score goal.
4. Use the Credit Score simulator to understand how specific financial actions may impact your credit. 
5. Undergo a financial checkup using Credit Score to assess your personal financial health, debt-to-income ratio, and budget analysis.

Resolution: Build Your Emergency Fund

A robust emergency fund is a cornerstone of financial well-being. If your current savings fall short of covering six months' worth of fixed expenses, take steps to remedy that. Being prepared with a sufficient emergency fund can shield you from financial crises.

Solution:

1. Initiate the building of your emergency fund using these helpful tips.

Resolution: Commit to Long-term Savings

Make this the year you prioritize long-term savings, especially for retirement. Maximize contributions to retirement vehicles such as a 401(k), and explore employer match opportunities. If applicable, contribute enough to secure the full employer match. Additionally, consider allocating funds to an IRA and a high-yield savings account.

Solution: 

1. Use this calculator to determine how much you need to save now to maintain your current standard of living in retirement.

Remember: Remember, meaningful financial changes don't have to be drastic at the onset of the new year. Begin with practical steps, focus on achievable resolutions, and set the stage for a financially successful year.