MIAMI VALLEY — Many people start the new year by making New Year’s resolutions.
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According to the website, one of the most important solutions is to save more money. statista.com.
News Center 7 Consumer Reporter Xavier Hershowitz News Center 7’s advice from experts on Daybreak broke down.
Financial resolutions are popular every year, but this year they’re especially popular.
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The new year brings all kinds of resolutions, but whether it’s fixing your finances or saving money, it all starts with how people spend their money.
Hershowitz spoke with Rob Barnett, CEO of Outlook Financial Center in Troy.
He said the important thing you can do is create a spending plan.
This is a dollar-by-dollar breakdown of how you spend your money each month.
It may sound like a lot of work, but where do you start?
“Fill out a spending plan where you think you’re spending. Start from there,” Barnett said. “For the next 30 days, he carefully records all his expenses. If he withdraws $40 from an ATM, he wants to know how he spent that $40.”
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He also told Hershowitz that people should compare “the amount of money they thought they spent” with “the amount of money they actually spent.” From there, you can easily find areas that you can change.
Barnett also said there are three areas to focus on to get our finances healthy this year.
- Milestones – from buying a car to buying a house.
- Create a debt reduction plan – Be organized and don’t be afraid to talk to people you owe about setting up a payment plan.
- Establishing and maintaining an emergency fund.
“The last thing you want is to put money on a credit card and have to pay 30% interest,” Barnett says. “That’s the whole idea behind an emergency fund, which is three to six months worth of household expenses.”
He says part of the idea of this spending plan is to allow people to spend money on what they want, but to do so wisely.
