5 financial tips for 2016
Now that 2015 is coming to a close (can you believe it?), it’s time to look forward to 2016. No one plans to let their debt get out of control – most of our clients have been good people who simply had unforseen events occur. By planning ahead and making good financial decisions, you can avoid those credit-busting bumps in the road.

The best way to avoid bankruptcy is to set a solid financial foundation and stick to your game plan. The following tips will help you plan ahead and form the right habits so that 2016 will be the year you can finally feel secure.

1. Talk about money

If you can’t dedicate the time to sit down and talk about your finances, then nothing else matters – the rest of the steps will be pointless. It’s important to talk openly about your money, so you know what’s coming in and what’s being spent. If you wait for a financial crisis, it’s probably already too late. If you sit down with your spouse and set goals together, you’re much more likely to stick to the plan you create.

2. Set a budget

Now that you know how much money comes in and what bills you have, you can create your budget. It’s important to create a realistic budget – don’t be so strict that it will be impossible to stick to your budget. We suggest using an application like Quicken or Mint to track your spending, but we’ve seen plenty of people be successful simply using an Excel document. Remember to check in regularly to be sure that you’re staying within your limits. It’s OK to adjust spending limits if you find that your original numbers aren’t realistic.

3. Plan for the unexpected

Unexpected “bumps in the road” are the most common reason our clients are in a financial crisis. A severe injury from a car accident or the sudden loss of a job could be the tipping point that sends your debt into a downward spiral. Make sure that saving for an emergency fund is included in your monthly budget. If you start the habit of tucking money away each month, you’ll build an emergency fund that will help get your family through any financial crisis that might pop up in the future.

4. Pay off credit cards

The worst thing you can do is to pay the minimum amount due on your credit cards each month. Look at all the credit card debt you have, and create a game plan for paying everything off. Typically, you’ll want to start with either the lowest balance OR the card with the highest interest rate. Once you’ve paid your first card off, take the money you were sending to that card every month and add it to another payment – and you’ll have your cards paid off in no time.

5. Save for retirement

If you live paycheck to paycheck, or just a few paychecks ahead, you won’t have anything saved for retirement – and that means you’ll have to continue to work. The earlier you start to contribute, the more you’ll save over time, thanks to compound interest. If your company offers a 401(k) plan, make sure you’re contributing at least at the level that your company matches – or you’re basically turning down free money.

If you follow these easy steps, you’ll be able to build towards a solid financial future, and 2016 will be the year that you’ll finally be able to stop worrying about your finances. If you’re still worried that your debt is too far out of control and these steps won’t help you, feel free to call us any time at 214-760-7777 and set up a free consultation. We’ll take a look at your financial picture and walk you through all of your options.