If you want to achieve your money resolutions, they better be SMART.
It’s that time of year again, time to make a new round of New Year’s resolutions. Statistics show about 41% of Americans usually make New Year’s resolutions. Unfortunately, studies also show that 80% of people have dropped their resolutions by February. And they also say only 8% of people actually make their resolutions happen.
So, if you decide to make New Year’s money resolutions to pay off debt, save money or achieve another financial goal, how do you make sure you can stick it out?
It’s starts by making sure your resolutions are SMART.
What are SMART goals?
SMART is an acronym that tells you how to make a goal that you can reach:
It’s how you make sure that a goal gives you a plan instead of just a dream. In this case, you set money resolutions for New Year’s that drive you to succeed.
“I want to pay off debt” is a good ambition, but it’s not a SMART goal. Instead, you need to formulate your ambition to be SMART.
“I will pay off my largest credit card balance of $______ amount by ________ 2018.”
You focus on one specific debt and set a time limit on when you want to pay it off. The amount and timeline that you choose depends on your budget and what you can afford. It’s a goal you can measure as you pay off part of the balance each month. This makes your resolution achievable, instead of just a nice ambition.
In the same way, instead of “I want to save more money,” a SMART goal would be, “I want to save $______ every month in 2018, so I can invest the money in a CD.”
You set an amount and give yourself an end goal for what you will use the savings to do. Certificates of Deposit offer better interest rates than your basic savings account, so your money grows faster. However you also can’t touch the money for a period of time, so you need to plan ahead.
How Consolidated’s credit counseling team can help you achieve your money resolutions
If you’re already a debt management program client…
Did you know you can make extra payments or larger payments on your debt management program? If you received extra cash for the holidays or money throughout the year, like a tax refund, use it to pay off your debt faster. Just talk to the customer service team to apply an extra payment or larger payment.
And if you have a goal to buy a home once you complete your debt management program, talk to one of our HUD-certified credit counselors. They can help make sure you’re ready for mortgage approval.
If you want to pay off credit card debt…
Total up your balances. If they’re over $10,000, then you may need some help to get out of debt. Even without interest charges included, it would take payments of almost $850 to eliminate your balances this year. And high interest charges mean it will actually take much longer.
So, you need a better way to pay off your credit cards. The answer may be debt consolidation.
Karee Eliminates $16,000 in Debt
Debt consolidation cut the interest rates on Karee’s credit card debt down to less than 6%. Consolidation cut her monthly payments in half and allowed her to get out of debt in less than five years.
Debt Consolidation in Action – a case study from Texas
This month’s featured debt consolidation case is from El Paso, Texas. Karee had almost $16,000 in credit card debt when she came to Consolidated Credit.
The credit counseling team negotiated her interest rate down to 5.73%. And as a result, her monthly payments dropped by over 50%, from more than $600 a month to just over $300 a month. And instead of taking over 11 years to pay off her debt, it took less than 5 years.
Karee saved almost $6,500 in interest charges alone. And she had this to say about her experience: “Paying off my debt has been simple and stress-free from the beginning. Everyone has been very helpful and supportive. I never thought I’d ever be out of debt, but in less than a year I will achieve my goal!
If you want to save money…
Saving money usually relies on finding the money in your budget to save. Then you need to build a budget that ensures that you set that money aside consistently. Nonprofit credit counseling services like Consolidated Credit can provide a free debt and budget analysis. They can help you set a budget that builds savings in, so it can become automatic.
Often, part of the challenge may be that you’re carrying debt. A certified credit counselor can help you evaluate if a debt management program would be beneficial to achieve your goals. People who qualify generally reduce their total credit card payments by up to 30-50%. That frees up more money for saving, so you can achieve that money resolution.
If you have money resolutions to achieve this year, talk to a certified credit counselor to make a plan. Call now!