8 Tips For A Financially Fit 2016

We’ve got our feet squarely into 2016, which is wonderful, because we’ve been given a clean slate. It’s time to reflect on the good and bad of 2015 and create a plan for the year ahead.

And I don’t just mean your commitments to healthy eating and exercise.

The new year is the perfect time to get financially fit . You won’t be alone in this: new year’s resolutions to get your financial house in order consistently rank in the top new year’s resolutions.

Are you ready to start 2016 off right? Let do this!

1. Rip Off The Band-Aid

It’s time to face the music…ahem, numbers….to see where you stand. Income, expenses, and spending last year. Once you realize how much you spend vs. how much you earned last year, and have taken stock of your prospected income and expenses for 2016, you can start to set goals, espectations, and create a plan comprised of action steps to meet those goals.

Now is also a god time to take stock of your net worth. How much you have in checking, savings, and investments can tell you how well you managed your money last year, how well you’re doing at reaching your retirement savings goals, as well as how well you managed credit cards, mortgages, and other debt like student loans and car payments. With this brutally honest information in tow, you can tell you money where to go this year, reach your goals, and get ahead.

If you don’t know where your budget stands, I highly suggest you check out Personal Capital. Personal Capital is very similar to Mint.com, in that it allows you to aggregate all of your accounts into one dashboard, it gives you more information and is easier to use. This is the only way to easily see your entire financial situation. Through Personal Capital, you can connect all of your accounts like bank accounts, credit cards, and even loans like your mortgage and student loans. Even better, Personal Capital is FREE.

2. Create a Death Book

More morbid than it sounds, a death book contains all of the information your family would need should something happen to your. Passwords, account numbers, safe combinations and more can be hard to keep track of and make your family’s job impossible in one of the worst things they might have to go through. Plus, it’s nice to update this information, all in one place, for peace of mind.

For passwords, you should keep some best-practices in mind. Use unique passwords for different accounts, not versions of the same passsword you’ve used since college, make them longer, include special characters, capitalized letters, and numbers to make them harder to guess. If you haven’t yet, consider enabling multi-factor authentication for online accounts to keep them even more secure.

Do you know what a death book is? Here’s why you need one.

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3. Got A Bonus? Best Smart About (Most Of) It

If your job comes with a year-end bonus perk, this time of year makes it so tempting to blow it all on something frivolous. A trip to someplace tropical, perhaps? But if you squelch those impulses and put 90% towards something practical, like retirement savings contributions or paying off credit cards, maybe even towards saving for a new home, you can spend the remaining 10% on something that you really DON’T need.

4. Retirement Isn’t That Far Away

Take a peek at your 401(k) and other retirement savings vehicles: your contributions last year, growth or losses because of your investments, and even how consistently you contributed. If you’re not yet contributing to yoru 401(k) to the maximum amount that your employer will match, do that immediately because you’re leaving free money on the table. 2016 contribution limits are staying the same as in 2015 ($18,000 unless you’re approaching retirement), but if you’re aren’t currently maxing our your retirement accounts, consider upping your contribution by 1%. You’ll barely notice the money being gone, and the little increase can add up to big long-term savings.

{Are You On Track To Retire? Find Out For Free!}

5. Take Stock of Your Emergency Fund

The idea of an EF (Emergency Fund) has gotten very novelized in the past few years with Dave Ramsey and other financial guru’s ideas really taking off. But regardless of your feelings on their advice, using an EF to save for a rainy day is a solid one. A 2014 survey found that almost half of Americans couldn’t handle an unexpected expensive of $4,000 with cash on hand. If you have to rely on your credit card in an emergency, it is all to easy to fall into – and stay in – debt. If you don’t yet have an emergency fund, start with $1,000. Then, work your way towards having 6 months of living expenses saved up and easy to get to. Take it slow, and you’ll be surprised how large your EF – and your peace of mind – will grow.

6. Leave No Expense Untouched

As you settle into the new year, don’t just take expenses as they come: question them. Everything from bank fees, credit card interest, and even the interest rate on your mortgage can be negotiated and lowered drastically saving you hundreds or even thousands of dollars each month. There is nothing that is non-negotiable. We even though our mortgage was non-negotiable, but we were still able to refinance and save $$37,500 in interest, keep our payment the same, get rid of the $480 a year were paying in PMI (private mortgage insurance) and knock 15 years off our mortgage.

There are ways to reduce every single expense, even utilities, phone bills, and internet, with out sacrificing quality.

{33 Ways To Cut Expenses, Make Extra Money, and Save Your Budget}

All expenses are negotiable. Here’s how to successfully negotiate them.

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7. Make Extra Money

Like it or not, if this hard look at your 2016 finances has left you feeling a little stressed, you can always find time to make extra money. From renting a room in your house on HomeStay or Airbnb, to doing odd jobs on TaskRabbit, or even to working online as a side gig, no matter what your schedule is like there are side jobs for everyone and every schedule.

{Want To Make Money From Home. Learn How Here}

8. Stay Committed

The most important factor in any good financial plan, especially one developed during the new year, is staying on top of things. The best way to do this is by taking 5 minutes every week to review and analyze your finances. Categorize transactions based on the budget category they fit into, and then review how your spending is comparing to your income. Doing this every week may seem like a lot, but it is only 5 minutes out of your day, and staying on top of your spending is a great way to stay motivated.

To create, plan, and stay on top of your goals and budget for 2016, check out the Marriage & Money Book + Workbook.

With its thoughtfully designed, full-color pages, Marriage & Money guides you through the process of envisioning your truest goals and dreams, and then creating an action plan that will empower you to make those dreams happen. From there, you will build a budget that works for both partners and your dreams.

From there, you will implement the 5-minute budget check-in, a quick and simple system designed to keep spouses communicating openly about their finances. Marriage & Money takes your finances from survival mode to thriving mode.