The new year is right around the corner. This means that it’s time to make resolutions that will enhance your life. While there are endless resolutions that one could make for the upcoming year, many of them involve finances.

Financial independence is something that we all long to achieve. Whether you want to become financially secure or if you want to pay off debt, it helps to have some guidance along the way. Here are some of the top tips and tricks to get your finances in order in 2022.

3 Tips to Get Your Finances in Order

1.      Create a Budget and Stick To It

Saving and investing for the long-term increases your net worth over time. The best way to make your money work for you is to create a budget and stick with it. When creating a budget, there are three things you’ll want to know to get your finances in order, including:

• How much you’re spending
• How much you’re saving
• How much money you’re bringing in after taxes

Not knowing how much money you earn or where it’s going makes it impossible to get a handle on your finances. Consider tracking your spending habits by using a mobile app or budgeting tool so that you can better manage your money.

Find areas where you can trim and always prioritize paying yourself first. After paying your bills, make sure you have funds left over to build a healthy savings account.

2.      Manage Your Debt

Despite what you may have read or been told, debt isn’t inherently good or bad, instead, look at it as a tool. Having some debt is a necessity, especially for building your credit report and creditworthiness. However, when debt becomes more of a burden than a tool, it’s time to regain control.

Always keep your debt load manageable. Know what you can afford to borrow versus what you should borrow. Just because you have a $20k limit on a credit card doesn’t mean that you should carry $10k in debt.

If you’re looking to get your finances in order and better manage your debt, pay off high-interest debt first. This often includes credit-card debt. It’s also important to avoid borrowing money to purchase depreciating assets.

3.      Prepare For The Unexpected

Another key part of getting your finances in order is preparing for the unexpected. Life is risky, and things can go wrong at any moment. Your finances can be upended by all sorts of things, including a job loss, illness, or a death in the family.

Make sure that you have enough assets at your disposal to insure yourself against major risks. Not only should you have an emergency fund, but you may also want to consider purchasing an insurance policy to protect you against unforeseen events.

For example, you can protect against costly medical expenses by having health insurance. Life insurance protects you and your family in the event of an untimely death.

It’s never too early to start planning your new year’s resolutions. Make 2022 the year that you finally get your finances in order! With these tips and tricks, you’ll be on the path towards financial security and independence. To learn how our financial services can help you, contact Satty, Levine & Ciacco, CPAs, P.C. to get started.