January 6, 2016 3:27 am
1. Reassess Your Budget – If you don't have a budget, make one. A budget is an essential tool for planning how you will spend, save, invest and enjoy your money. It should be a guideline to how your money will work for you, and not written in stone. Life changes, and outside influences mean you need to periodically examine and update your budget. Start by jotting down your financial goals for the year, then review your budget to see if it's going to help you achieve those goals, or if you need to make adjustments.
2. Pay Off Holiday Bills ASAP – Every month you carry a balance on a credit card, interest rates increase the actual out-of-pocket cost of those holiday gifts you purchased. If possible, pay balances in full right away during the month of January. If that's not possible, create a payment plan for yourself with the goal of paying off the total balance in as high an increment as you can afford, so you minimize the time you're carrying a balance.
3. Maximize "Found" Money – Did you know more than a third of gift card recipients in the last year have not used their cards? If you have a gift cards you don’t plan on using, bring them to a Coinstar Exchange kiosk at your local grocery store and exchange them for instant cash. Put the extra money toward paying off holiday bills or boosting your emergency fund.
4. Review All Your Credit Accounts – Even the most careful shopper can fall prey to crooks, who are particularly active and crafty during the holidays. Look over your credit card statements to ensure you authorized all the charges that appear on them. For an extra layer of safety, check your credit report; it can help you detect signs of identity theft or other fraud.
5. Increase Your Savings – By now, you've reviewed your budget and cashed in your unused gift cards, so you've got some extra money in your pocket. Instead of spending it, use that money to increase your savings. It's especially important to have an emergency fund equivalent to a few months of living expenses. Those savings can help protect your financial health against unforeseen circumstances like a big auto expense or home repair bill, or even a job loss.
Published with permission from RISMedia.