Welcome to a new decade!
This is the time of year when we are deluged with "new year, new you" messages. From resolutions for weight loss and
fitness to learning a new language or quitting smoking, it's hard to keep up with all of the pressure to improve our
I don't know about you, but sometimes I feel overwhelmed by all of the competing challenges - especially right after
an exhausting holiday season.
Here are a few ideas I'd like to share that can become simple projects that will pay off in big ways.
1. Establish an Emergency Fund.
Did you know that a large percentage of Americans has little to no emergency cash - many people can't handle an unexpected
expense of even $300 without dipping into debt. If you set aside an account and fund it with only $1,000 at first,
you can manage many plot twists that life might throw your way. Whether it's a blown-out tire, an emergency room visit
with a sick kid, or a dryer that needs repair, having this modest amount set aside can make a big difference in your
overall financial peace. TIP: this needs to be separate from your usual cash flow accounts and if you use part of it,
be sure to build it back up as quickly as possible.
2. Pay down debts.
Second to establishing an emergency fund, reducing your overall debt load - especially debts that are associated with
non-appreciating assets such credit cards, vehicle loans, and other consumer lending accounts - is the next highest
priority. I recommend starting with the smallest balance, add as much as you can to your regular monthly payment until
it's paid off, and then move up to the next smallest balance with the accumulated monthly amount you were paying on
the previous debt - and so on. This is known as The Snowball Debt Reduction Method and it works! This is especially
good if you are on a tight budget and feel that paying off debts is out of reach. If you have a lot of extra cash flow,
you might do better overall by focusing on the debts with higher interest rates first. Here's an article that describes the Debt Snowball Method in greater detail
3. Plan for Long Term Prosperity.
After you have set up an emergency fund and started to pay down debts, creating a plan for a solid financial future
is guaranteed to help you stay focused on an inspiring goal. This is where you begin to dream of what is possible and
lay the foundation for what you really want. It's surprising what can happen with a little planning.
I've made this simple but sometimes the whole thing seems a lot more complex. I'd like to offer my help and special
attention on your specific situation. I have tools at my disposal to help you evaluate what's best for you - and I
have professional financial advisor friends who can provide in-depth analysis as needed.
One more thing! If you are in great financial shape but know someone who might benefit from this update, please feel
free to forward it to them. I love to help those you care about. Your referrals are the heart and lifeblood of my business.
Happy New Year!