Are you financially ready to ring in the New Year?

2016 is fast approaching, and while it may sound cliché, it is time to consider what your financial resolutions are for the coming year. As an investment advisor, I have some suggestions to share with you.
Resolve to forgive yourself
This is the most important financial resolution you can make; forgive yourself for past financial mistakes and move on to a more realistic plan for the New Year.
Baby steps
You cannot completely re-do your financial picture in a single year, but you can start anytime you want. Focus on planning for your financial future with small, informed steps, rather than a single leap. For instance, a great resolution is “I will build my savings.”
Implementing this resolution is easy, too – ask your bank how you can transfer funds from your checking account to your savings account on a monthly basis. If you transfer just $40 a month (only $10 per week) the magic of compounding interest begins and your money starts to grow. As you get into the habit of saving, start a conversation with an investment advisor on how you can invest for your future or buy an annuity now that will be there for you when you retire.
About those credit cards
Shred them or burn them and resolve not to use them again. The interest rate on credit card transactions not paid on the next statement is ordinarily higher than most other types of credit. Of course, if you have a savings account, it is likely you can borrow from yourself and have no interest to pay – just make sure to pay yourself back.
Make sure your financial resolutions are attainable
Setting an unrealistic financial goal is a sure way to make it a certainty that you fail. Make your goals simple and not so far removed from your reality, so that they are achievable.
Create a system to reward yourself
Changing your financial habits is hard work. So, when you reach a predetermined and achievable goal – say saving $120 and multiples of it like $240 and $360 – reward yourself by taking a personal day, getting a mani-pedi, getting a real barber shop shave or buying that shirt you have been eyeing for months. Hard work deserves rewards.
Consequences of not following through
If you reward yourself for success, should there also be consequences for falling short of your goal? I don’t believe that’s necessary. Positive reinforcement is the best way to change. Just remember the reasons behind your resolutions and stick to them as much as possible. Use a failed resolution as a learning moment and get back on track with your financial program.
Financial items that need attention at year end
An important habit to get into is an annual financial checkup. Perform a self-audit of yourself and check for:
Life changing events
Life changing events are for financial matters that include:
• Birth of a child or grandchild
• Death of a spouse
• Marriage
• Divorce
• Higher education for children
• Higher education for yourself
• New employment
• Retirement
• Unemployment
• Substantial inheritance
• Other
Notify your insurance advisor, attorney, and investment advisor of any major milestones that you had in the past year and make it a priority to do this annually.
Happy New Year!
This material is intended to provide general financial information and is not written or intended as tax or legal advice. Individuals should seek advice from their own tax or legal counsel for their particular situation. Investment Advisory Services offered through Global Financial Private Capital, LLC, and an SEC Registered Investment Advisor. Jared Elson and Global Financial Private Capital, LLC do not provide tax or legal advice.

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