The new year is right around the corner, and that means it’s resolution time. While you might be planning to drop 10 pounds or finally land your dream job, you should consider making some financial resolutions, too.
In fact, according to a Fidelity survey, more than one-third of Americans made a money resolution last New Year’s. Unfortunately, even solid resolutions fall by the wayside come springtime.
“Most people fail to keep their resolutions because they don’t create an action plan to achieve their goals and fall back on old habits,” said Mike Sullivan, a personal finance consultant with Take Charge America, a nonprofit that counsels on credit and manages debt. “In the case of financial resolutions, the best plans are focused on forming new money habits.”
With that in mind, here are five financial resolutions to make in 2019 and how to keep them.
1. Contribute to your retirement
According to a new survey by Earnest, a whopping 69 percent of millennials are not saving for retirement. While it’s difficult to set aside more money in addition to costs such as student loan repayment, putting even a little bit aside for retirement now can help big time in the long run.
“The more you save early, the more you will have, and by a lot,” said Leland Faust, financial expert and author of “A Capitalist’s Lament: How Wall Street is Fleecing You and Ruining America.” For example, according to Faust, if you save $250 a month with a 6 percent return, you can end up with about $250,000 after 30 years. But if you save for 40 years, you’ll have almost double that amount.
John Piershale, an advisor at Piershale Financial Group, said the new year is a good time to enroll in a retirement plan at your job. “Establish a retirement account early, and consistently contribute money to it,” he said. “You can easily do this by having an automatic deduction monthly from your bank account that goes to your retirement account.”
2. Get your student loans under control
Want to make 2019 the year you get serious about paying off your student debt? There are a number of ways to do it.
Joe Heider, founder of Cirrus Wealth Management, suggested that student loans should be organized based off of interest rates. “Make it a priority to pay off the higher-cost debt first to limit the interest paid over time,” he said. This strategy is known as the “debt avalanche” and it one of the most popular tactics for saving money on your loans.
Another popular method is the “debt snowball.” You focus on paying off the smallest loans first. Experts tout this as a psychologically empowering method because there’s something satisfying about crossing a debt off your list entirely. This tactic can be particularly helpful when you’re trying to stay motivated with your New Year’s resolution.
Lastly, if you need to lower your monthly payment, consider an income-driven repayment program based on what you can afford. Or, if you need a lower interest rate, look into refinancing your loans. Check out this post on the pros and cons of refinancing, and try our Student Loan Refinancing Calculator to see how much you could save.
3. Automate your savings
Saving money is a time-tested way to shore up your financial security. Unfortunately, almost half of Americans admitted they wouldn’t be able to find $400 in an emergency, according to a Federal Reserve study.
Saving for a rainy day seems difficult if you have a lot of expenses on your plate already, but luckily, saving even a few dollars here and there can help in a big way. “Even if you only save $50 every two weeks, you’ll have $1,300 to show for it at the end of the year,” said Sullivan. “To make it easy, work with your employer to authorize a direct deposit to your savings account.“
Where do you start? Check out these six great browser extensions that make automatically saving money a cinch.
4. Create a budget (and stick to it)
Whether you want to save more money or pay down your student debt faster, coming up with a budget is the best place to start.
“For the new year, take a list of what will matter to you over the next one year, five years, and 10 years,” said Uri Pomerantz, CEO of Twine, a new collaborative saving and investing app. “From there, you can better understand what you can do now to make those goals happen.”
Once you know your goals, begin to make your budget by closely tracking all of your income and expenses. From there, you could try a variety of strategies such as automating your monthly bill payments or paying for everything in cash. Sharing those goals with others also helps psychologically with keeping them and providing a level of accountability.
To make this new budget stick, Sullivan recommended sitting down once a month and budgeting your income and expenses. “Do this at the beginning of every month, and it will quickly become a habit and will make a tremendous difference in your finances,” he said.
5. Make more money
While you are working hard to pay off your loans and take care of your expenses, sometimes your day-to-day job just doesn’t cover it all. Taking on a side hustle is a great way to earn some extra cash — even better, you can work many gigs around your schedule.
Althea Green holds down a full-time job, but drives for Uber on her off hours and can make $400 in one weekend alone. Armaye Ejigu, meanwhile, makes deliveries for DoorDash on his lunch break and after work to pull in an extra $500 to $900 a week. Or try one of these easy money-making ideas, such as dog walking or teaching English online.
Check out Student Loan Hero’s side hustle marketplace to jump-start your search.
Aim for financial success in 2019
These resolutions are just some examples of the many possible goals you can set to boost your financial health for the year ahead. Consider other ways to turn things around, whether it’s using a personal loan to pay off your high-interest credit card, or saving money on gas by carpooling to work.
Even if you can’t keep all of these financial resolutions in 2019, keeping just one or two could help make a big impact on both your long- and short-term money goals.
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
|Lender||Variable APR||Eligible Degrees|
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1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 6.97% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.30% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at firstname.lastname@example.org, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
APR stands for “Annual Percentage Rate.” Rates listed include a 0.25% EFT discount, for automatic payments made from a checking or savings account. Interest rates as of 11/8/2018. Rates subject to change.
Variable rate options consist of a range from 3.27% per year to 6.09% per year for a 5-year term, 4.64% per year to 6.14% per year for a 7-year term, 4.69% per year to 6.19% per year for a 10-year term, 4.94% per year to 6.44% per year for a 15-year term, or 5.19% per year to 6.69% per year for a 20-year term, with no origination fees. APR is subject to increase after consummation. The variable interest rate will change on the first day of every month (“Change Date”) if the Current Index changes. The variable interest rates are based on a Current Index, which is the 1-month London Interbank Offered Rate (LIBOR) (currency in US dollars), as published on The Wall Street Journal’s website. The variable interest rates and Annual Percentage Rate (APR) will increase or decrease when the 1-month LIBOR index changes. The variable interest rates are calculated by adding a margin ranging from 0.98% to 3.80% for the 5-year term loan, 2.35% to 3.85% for the 7-year term loan, 2.40% to 3.90% for the 10-year term loan, 2.65% to 4.15% for the 15-year term loan, and 2.90% to 4.40% for the 20-year term loan, respectively, to the 1-month LIBOR index published on the 25th day of each month immediately preceding each “Change Date,” as defined above, rounded to two decimal places, with no origination fees. If the 25th day of the month is not a business day or is a US federal holiday, the reference date will be the most recent date preceding the 25th day of the month that is a business day. The monthly payment for a sample $10,000 loan at a range of 3.27% per year to 6.09% per year for a 5-year term would be from $180.89 to $193.75. The monthly payment for a sample $10,000 loan at a range of 4.64% per year to 6.14% per year for a 7-year term would be from $139.65 to $146.76. The monthly payment for a sample $10,000 loan at a range of 4.69% per year to 6.19% per year for a 10-year term would be from $104.56 to $111.98. The monthly payment for a sample $10,000 loan at a range of 4.94% per year to 6.44% per year for a 15-year term would be from $78.77 to $86.78. The monthly payment for a sample $10,000 loan at a range of 5.19% per year to 6.69% per year for a 20-year term would be from $67.05 to $75.68.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown.
All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 2.28% effective October 10, 2018.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate|
|2.47% – 6.30%1||Undergrad & Graduate|
|2.51% – 8.09%4||Undergrad & Graduate|
|3.02% – 6.44%2||Undergrad & Graduate|
|2.69% – 7.21%5||Undergrad & Graduate|
|2.79% – 8.39%6||Undergrad & Graduate|