Simplifying your new year
Posted on Jan 12, 2021 10:16:00 AM by Megan Santkuyl
“I want to simplify my life.” A common phrase we tell ourselves at the beginning of each year, but how does one go about doing so? A great place to start is your finances. Finances not only affect your pocket, but they affect your mental and physical health. Finding a way to streamline this task can reduce unneeded stress in your life.
Track your expenses
Begin by tracking your monthly expenses and categorizing them. This can include groceries, gas, out to eat, etc... Keep receipts of purchases to monitor your spending habits. Tracking your expenses will help you uncover any frivolous purchases that can be cut from your budget to save money.
Set a monthly budget
Having a monthly budget can help take the uneasiness out of paying bills. While it may seem overwhelming at first, budgeting can be quite simple once you get the hang of it. Here is how to set a monthly budget:
- Figure out your monthly income, expenses and debts for the month. Ideally, income should always be more than expenses and debts. If your calculations come up negative, you need to adjustments to your plan and prioritize your expenses.
- Now focus on your debts. Interest builds quickly so try to pay off all higher interest debts first. Always try to make more than the minimum payment. This method will help you to pay off your expenses faster. Once you have a debt paid off, use the funds that have been freed up to make payments towards other debts.
Don’t be afraid to ask for help
If your finances are starting to interfere with other life aspects such as your marriage, work, sleeping and anxiety, seek help. One way to do so is by consulting a financial health counselor. Financial health counselors take a holistic approach to personal finance. They are there to assist you. Sometimes, it is just good to get a second opinion on your finances to help relieve stress.
Simplifying your finances can be rewarding and can free up time for you to do other things like spending time with your family. Create intention within your day to stick to your budget and improve your financial situation this year. Though it may seem daunting at first, it will be well worth the time and effort.
Blog written by:
Megan Santkuyl, financial health counselor, Catholic Charities