Where are you with that plan?

Soon the hustle and bustle of the holidays will be upon you and your focus will be on food, gifts, and gatherings. Take time now to stop, look, and listen to your bank account, credit card statements, and especially your day-to-day money outflows.

In fact, mark your calendar and do this in six months again. Then make it an activity you return to on a twice a year basis.

Here’s an easy tip to rescue you from going overboard with your finances during the remainder of the year. This will also help you land more safely in the New Year with your goals and objectives in mind.

Take about two weeks of your time now to write down every single penny you spend. Yep, you read that correctly – every single penny. If you’re a client of Navalign you can do this with your eMoney client website, or create a spreadsheet, or try using a different app that helps you track your finances for free online. There are plenty of apps that will track your finances for you, or you can elect to start making daily notations as you pay bills, buy coffee, fill up with gas, stop by the market, etc.

Do this for about 2 weeks to get a really good sense of where the money is going. If you want a more telling record, keep your list ongoing for a whole month.

Some people tell us they can look at their bank account and keep track mentally. We’d suggest this technique is probably not working as well as one thinks it is. Keeping track of your balance is not the same as keeping track of how and why you are spending money. If you have cash in your pocket and you spend $5.68 for a coffee and croissant, you’ll need to write that down in your list of expenses for that day, too. There are so many ways our money can flow in and out of our bank account.

Try recording your spending this one time. Write it ALL down, every single time you make a purchase. It might seem like a daunting task, but consider it may also open your eyes to your money habits, good and bad. It will also help you better manage your future plans and decisions. Keep in mind, taking the time to write down what you spent and review your habits is a powerful exercise in and of itself.

You may be happy with your level of spending and are unwilling to bother with that level of detail. Your lack of attention to spending detail may function for you for a while. However, meeting life goals, building wealth, and having the resources to be financially free requires that you often stop and reassess your financial situation.

Then, you can adapt and adjust your spending according to your goals. We once heard that there is freedom in discipline. Right now is a good time to start practicing this statement, when considering your money and life discipline. If you need advice or help to achieve this balance, consider enlisting the assistance of a financial planner.

In addition to tracking your spending, here are a few other tips to help you build wealth in 2020.

Reduce your living expenses

Reducing your living expenses is a very broad suggestion. So we’ve broken up this idea into three easy ways you can tackle this.

  • Avoid buying the stuff you don’t need – It’s impossible to avoid consumer craze, especially around the holiday season. The endless options of convenience are so tempting, often we become convinced that we need every product on the market. However, start to take a step back from your “consumer self” to evaluate your needs objectively. You may find that you’re often purchasing out of misled desire, as opposed to true need. This is an area you can reduce your spending and your living expenses.

  • Save on your car – We would very much like to drive the newest model car with all of the options. However, it’s not a necessity and remember an automobile is a depreciating asset. Choose a vehicle that will cause you the smallest amount of stress possible. The possibility of vehicle stress comes in a variety of forms. It might be from enormous monthly payments, maintenance fees that exceed your planned budget allocation, more expensive insurance and registration costs or lack of safety features. Take your time when choosing the care you drive. Pick a vehicle that will mitigate these real and valid elements of stress, while still meeting your most important desires.

  • Always save a portion of your income first – This suggestion is an outcome of the two mentioned above but all too often we treat it as such and spend first, then save what is left over. When you cut your extra spending on unnecessary items, it can allow you to reallocate the money toward your saving and investing goals. Make it a point to adopt a save first mentality. Automate savings and place a portion of your income in an emergency fund, your preferred retirement savings vehicle and other investments. Don’t let it wander off into another area of expenses that you don’t need. Reducing your living expenses now, so you can save for later, is a wise decision across the board. Provide for your future by saving today.

Earn more, much more

Everyone wants a bigger paycheck. It’s the American dream – to make the type of money that sets you and your family up for a comfortable lifestyle now and in the future. But how do you do this?

  • Outwork the pack – No one gets anywhere by simply wanting something to happen. Therefore, if you want to earn more, you’re going to have to work for it. We are not suggesting you should have a daily competition with your work peers as to who can do the most. What we are saying, is to show up for yourself every day and put in the work to advance your career prospects. Your dedication and effort will not go unrewarded or unnoticed.
  • Market yourself – While sometimes it’s okay to let good deeds speak for themselves, in your professional career, assure you’re bringing attention to your success and innovation. In addition to “tooting your own horn” make sure you dress the part and walk the walk. Create a reputation that is marketable among your peers and higher-ups. People want an association with someone who is well kept, intelligent, and capable. You have the ability to be that person, so market yourself as such.
  • Invest in your education – Your education is one of the best ways you can invest in yourself. While an initial output of funds is required, the possibility of what you will gain will enable you to push forward to that next level of income that you’ve been eyeing. However, don’t obtain more education without a solid plan in mind of how it will benefit you and your career. Make intentional decisions about the degrees, certifications, and training you pursue and form a comprehensive understanding as to how they will increase your bottom line.
  • Consider entrepreneurship – In order to take your wealth to the next level, you will more than likely need to divert from the limitations set before you by corporate America. This is not to say you won’t find success in a job that you work for others. However, one of the more efficient ways of achieving a drastic increase in your yearly revenue is working for yourself and aligning your profits with your desired lifestyle.

Bottom line

Maintaining detailed notes about your spending habits, reviewing your status regularly, incorporating the skill set of a financial advisor, and adjusting as needed is the best and most effective way to assure you are staying on a path toward your financial goals. Form an early age, it is important to identify what your long-term goals are for your finances. As you grow, your aspirations will change, and that’s okay. However, as the saying goes, failing to plan is planning to fail.

Do not allow yourself to become so entrapped by your finances that you can’t see beyond tomorrow. Start keeping a detailed eye on how you’re handling your money, so that you can rest assured that you’re taken care of in the future, especially your retirement years.