Tips on How to Accomplish Your 2020 Money Goals and My New Year’s Money Resolutions
This post has been sponsored by BECU. All opinions are my own.
2019 was an incredibly eventful year. I graduated from grad school, got engaged and met almost all of my 2019 financial goals. This year I focused on building up a 6-month emergency fund (check!), continuing to pay down my student loans (check!), and staying within my eating out budget (not check). For the most part, I’m really happy that I’ve paid over half of my student loans, and I’m also feeling much more secure with my 6-month emergency fund.
With the new year just around the corner, I’m excited to set my New Year’s money resolutions. Like last year, my resolutions will include both saving and paying down student debt. I’m also excited to share with you a few questions to ask yourself when setting up your own financial goals for 2020.
When setting my New Year’s money resolutions, I ask myself questions to ensure I’m on the right track to achieve my financial goals and gauge what I can do in the upcoming year to get closer to meeting them.
If you aren’t sure where to start, here are a few questions to ask yourself:
Have you made a financial self-assessment?
Before you start creating savings goals, I recommend spending some time thinking about your financial health. This includes looking at your savings, your debt (credit card, student debt, car loans, etc.) and your credit score in totality. You can do this on your own or schedule a free 1:1 Financial Health Check consultation with a Financial Health Check specialist at BECU.
What are your financial goals?
Whether you’re trying to build up an emergency fund or save for a big summer trip, make sure you write out all of your financial goals. My tip for creating financial goals is to identify 2-4 goals for the entire year. You don’t want to overwhelm yourself, and it’s better to set a handful of clear goals with meaningful reasons why you want to achieve them. For example: “I want to stay on budget for my wedding so I can continue to save towards a future home and make my monthly student loan payments.”
Have you established your budget? Or do you need to update your budget?
If you aren’t budgeting in 2019, you have a great opportunity to start in 2020. I recommend creating a budget by taking out a piece of paper and outlining your total income, monthly expenses and monthly savings. This helps you have a better understanding of where your money is coming and going.
If you’re needing a little help with budgeting, check out BECU’s tips for better budgeting. These simple and easy-to-do tips will go a long way to help you accomplish your goals.
Have you started your emergency fund?
Today you may be physically healthy, employed and are able to cover all your bills. However, life takes unexpected turns and you may be laid off at some point or face a medical emergency.
That’s when an emergency fund comes in. BECU Financial Educator Stacey Black recommends saving between 3-6 months of your income to help build your emergency fund. If your goal by the end of 2020 is to save 3 months worth of income, you can divide your 3 month salary by 12 to calculate how much you should be saving each month.
Have you started saving for retirement?
While it might be hard to envision retirement at the beginning of your career, it’s never too early to start saving for the future. You can open a Roth IRA, a traditional IRA, a 401(k), or your own savings account to start setting funds aside for retirement.
You can also check with your employer to see if they offer some sort of 401(k) matching program. For example, if you contribute 6% of your annual income, your employer may offer to match 4%.
There you have it friends! Five questions to help you think about your financial goals for 2020. I used these questions to help me plan my 2020 New Year’s money resolutions. Keep reading to see my financial goals for the new year!
My Four New Year’s Money Resolutions:
Resolution #1: Save for a down payment on a home
With my wedding planned for next fall, home buying has entered my short-term financial goals. To help make my dream of home ownership a reality, in 2020 I will open a dedicated savings account called “Future Home.”
I plan on using the automated savings that were originally transferred into my emergency fund to start feeding into this savings account. I also plan on saving at least $1,000 of my blogging money each month toward my “Future Home” fund. By naming my accounts, this helps me stay organized and on track to ensure I’m meeting my savings goal, which is to save between $25,000 – $30,000 by the end of 2020.
If you’re looking for a place to house your savings, check out BECU. At BECU, members with savingsaccounts can receive higher interest rates, free online banking and even more great features that make it easier to save! If you’re ready to buy a home in 2020, BECU also offers a First-Time Homebuyer Grant program that awards eligible members with up to 2% (maximum of $6,500) of the down-payment or closing costs on their first home.
BECU is federally insured by NCUA
Resolution #2: Continue to pay down student loans
According to BECU’s Saving & Spending Survey, 80% of Americans have some type of debt, so I know I’m not alone in prioritizing my student loans. With a little less than $15,000 to go, my goal for 2020 is to pay off 30% of my student loans. To do so, I’ll need to continue paying between $350-$450 a month to stay on track and pay it off in 3 years.
Paying off my student loans was also one of my financial goals in 2019. You can read more about my 2019 financial goals at “New Year, New Outlook on Finances: How I balance student debt and still save.”
Resolution #3: Stay on budget for our wedding
I recently got engaged (hooray!), so my fiancé Brandon and I are officially wedding planning. To start, one of the first things we did was sit down and discuss what our budget would be for the wedding. We decided that we would be okay spending $20,000 in total with a $5,000 contingency budget.
Here’s how we broke down our wedding budget:
I plan on documenting, blogging and sharing my whole wedding planning process on social media. With this in mind, I plan on partnering with brands to sponsor various wedding elements like save the dates and wedding invitations.
While I’ll spend more time working on wedding content this year, I know it’ll help us save on the wedding overall. Besides, I’m excited to blog about our wedding anyways!
Resolution #4: Begin investing
My first five years out of college were focused on paying off student debt, building an emergency fund and traveling for fun. Now that my emergency fund is built up and my student loans are under control, my new goal is to turn my energy and focus towards investing.
I’m not going to lie, the thought of investing my money scares me a little. I didn’t grow up in a household that invested or talked about the stock market, and I recently learned that I’m not alone. Research shows that women face an investment gap.
According to an InStyle article, “What is the Investing Gap and How does it Affect Women?,” many women aren’t investing due to fear. I was shocked when I read that “a woman earning $50,000 could be losing $265,539 to the investing gap by the time she retires.” I realized that I’m one of these women who are afraid to invest out of fear.
In 2020, my goal is to answer these questions:
- How much of my income should I be investing?
- What tools or platforms should I use to invest/manage my investments?
- What should I invest in? Stocks? Bonds? Mutual funds?
I plan on signing up for an investment course and start listening to finance podcasts so I can better educate myself about investing.
Now that I’ve shared my four main financial resolutions for the new year, what are your financial goals for 2020? Is it to eliminate your credit card debt? Is it to pay down your student loans? Comment below!
Thank you for reading!
Photos: Holly Phan