Without fail, the number one New Year's financial resolution is paying off debt, followed closely by building up savings – every year. Why are we so terrible at meeting these goals? Let's face it: saving is no fun while we're doing it and we don't see any tangible, immediate benefits from paying off debt, especially when it feels like we're passing up buying things we want to have. But what if we turn it around and look at what you spend instead? Here are 3 tips to help make this the year you finally achieve your financial resolutions.
1. Set a Budget
The most basic tool to get your finances in line and meet your goals is a budget. Yep, we used the dreaded “B” word. You might be thinking that you don't like budgets, but have you ever tried one? If you never have, how do you know you won't like having one? Think of it as a spending plan, making sure that you spend less money than you earn. After trying out a realistic budget, most people agree that the alternative – being in debt – is much worse.
2. Know Your Credit Score
In Canada, you can receive one free credit report each year, either from TransUnion or Equifax. If you haven't already set a date where you run your own credit check, there's no time like the present to order yours and get your full financial picture. Make sure to correct any inaccuracies in your credit history. If your credit is less than stellar, talk to a professional – banker, financial advisor or, yes, even your mortgage broker – about what you can do to improve it.
3. Start Your Savings
Whether you're saving up for a down payment on a home, your child's education, or a long-awaited dream vacation, your spending plan will tell you how much you have left for the piggy bank. It's important to have realistic expectations for your savings, since it will likely take you more than a year to reach your final target. To keep yourself motivated along the way – and to make sure you stick to the plan – set up little rewards for yourself as you reach milestones for your goal. Make the rewards small, as they shouldn't deplete the savings you've worked for, but it should encourage you to save more and grow that money.
Our team has helped many clients achieve goals that they thought were impossible. If owning a home is your resolution this year, a mortgage broker can help by pre-qualifying you for a mortgage. We believe that buying a home is more than a rewarding experience; it's also an important cornerstone in your financial plan. We don't simply view a mortgage as debt, but rather an overall piece of the monetary puzzle. Whatever your financial goals may be this year, we hope you reach them and would be happy to support you in getting there!
Auxilium Mortgage Corporation is based in Victoria, BC and works with clients locally and across Canada. The Auxilium team has over 100 years of combined financial experience and access to dozens of lenders to help you meet your goals.
