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5 Steps you Must Take to Prepare for the New Year

Chris Gottschalk

Chris Gottschalk About The Author

Dec 22, 2022 4:45:00 AM

For many people, preparing for the new year means making some spur of the moment resolutions and leaving it t that. If you’re feeling a bit more ambitious, you might make SMART goals out of your resolutions and keep track of your progress throughout the year. If you really want to make the new year yours, though, you need to prepare for it. 

Preparing for a new year might seem like an intensive progress that would take weeks to accomplish, but the reality is that you can probably get it done in the period between December25 and January1. All you have to do is follow a few simple steps.

Review the Last Year

Before you can look forward to the new year, take a moment and reflect on what happened this year. Think about the financial goals you accomplished, as well as any positive changes that you made. Perhaps you finally took out a mortgage on a house, or maybe you started putting more money toward your emergency fund. Maybe you even got a new job.

However, you’ll also want to think about things that could have gone better. You don’t want to beat yourself up for mistakes, but looking over your financial missteps can help you do better the next time you’re in a similar situation. It also reframes the mistake as less of a failure and more of a learning experience.

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Declutter Your Files

Man with papersBefore heading into the next year, get rid of the things you don’t need, especially financially. Go through your files and figure out whether you can get rid of any records that are outdated, like the address of a bank whose loan you’ve already paid off. You can also get rid of old financial records, such as:

  • Tax documents older than 7 years
  • Paycheck stubs older than 2 years
  • Bank statements older than 2 years (less if you have an online bank account)
  • Credit card statements, unless a statement has an item you want to claim a tax deduction for

Create a Gratitude List

When you practice gratitude, you get benefits in several areas of your life. This includes your finances.

You can practice gratitude simply by thinking about what you were thankful for in the past year. You can also make a list that you can refer to and look over from time to time. This isn’t just a great way to improve your mood, it can also lower your stress level and help you to stop worrying about whether you’ll ever have enough money.

Review Your Financial Goals

A family at a beach on vacationThe end of the year is a great time to take stock of your financial goals. While you already thought about all the financial goals you accomplished when you were reviewing the last year, now is the time to look toward the future.

If you’ve got any goals you didn’t complete in the past year, start by looking at them and figuring our how much progress you’ve made towards achieving them. Once you’ve done that, think about the goals you’d like to accomplish this year.

Make sure to write down all the goals you come up with, so you don’t forget about them. If you really want to make sure you achieve the goals you have for this year, make them SMART goals—Specific, Measurable, Attainable, Realistic and Time-Bound. 

While you're writing out your goals, you might also want to think about where you'll store the money you're saving for your goals. Ask yourself, "Where can my money earn the most interest?" and "Should I invest some of the money I'm saving for my goals?" 

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Adjust Your Spending Plan

Finally, adjust your spending plan, better known to some people as a budget. You should ideally be adjusting your budget on a monthly basis, but the new year is a good time for you to look over your budget and make sure that you’re not just sticking to it, but that the categories reflect your financial needs.

In order to adjust your budget:

  • Determine if you’ve overspent your budget
  • If you have, figure out in which categories you’ve overspent
  • Take funds from budget categories in which you’ve underspent and use them to increase the limits of the overspent budget categories
  • If you have extra money in your budget, add it to one of the existing categories, or even create a new budget category

Own the New Year with Help From First Alliance Credit Union

Most people want the new year to be their year. However, if you really want the next year to go well for you, you should prepare in advance. Look back at the previous year, consider your successes and failures, then organize your files and think about the goals you’d like to achieve in the upcoming three hundred sixty-five days.

If you’d like some help making the new year yours, become a member at First Alliance Credit Union. We have several guides in our resource center designed to do everything from help you get out of debt to start your own small business, and we offer several accounts that will help you save more money. 

We do our best to provide helpful information but we cannot guarantee the accuracy or completeness of the information presented in the article, under no circumstance does the information provided constitute legal advice. You are responsible for independently verifying the information if you intend to use it in any way. Additionally, the content is not intended to be reflective of First Alliance Credit Union’s products or services, for accurate and complete details about our product and service information you must speak to an advisor at First Alliance Credit Union.