How to achieve your financial goals for the new year
Updated On: Jan 13 2014 07:43:23 AM CST
Since good financial management is a popular New Year's resolution, KTXS looked into some pointers that may help.
Nick Shepherd, a financial consultant for Charles Schwab in Abilene, shared some advice for people interested in saving money or wanting to set up retirement accounts in 2014.
"We are in a new year and I know a lot of people focus on getting a new gym membership or they focus on getting healthy for the year, we would approach the same concept when it comes to their finances, it's a great time to start with a clean slate," Shepherd said.
To start off on that clean slate, he said it is best to begin with a financial plan.
"First and foremost, putting a financial plan together and having a goal in place will be where we would start," Shepherd said. "Most people, we tell them three different areas: what are their short term goals, their medium term goals and their long term goals."
After the financial plan is set, Shepherd said putting together a budget is the next step you need to take to better manage your funds.
"Most people we talk to have no idea how much money they're spending on a monthly basis," Shepherd said. "Putting a budget together is key, that's the second step after putting together a financial goal."
To start making that budget, Shepherd recommends making two lists. The first list should detail how much you spend on your essentials (i.e. utilities and clothing). The second list should include your non-essential costs (i.e. vacation and entertainment expenses).
He also recommended revisiting those lists each month to make sure you are monitoring your spending habits.
As for retirement, Shepherd said it is never too early or late to start saving.
"It's not uncommon for people to be halfway through their career and they haven't started saving, so start messing around with the tools on our website and come in and we can put a plan together for you."
Preparation is key to avoid financial surprises. Shepherd said that by having an emergency fund with at least a three to six-month financial cushion stowed away, you are relieving yourself of stress when life happens.
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