Top 40 Financial Hacks for your New Year’s Resolutions

The song “Auld Lang Syne” is derived from a famous Scot’s poem which is played with the start of every New Year. The title may be translated into English literally as “for the sake of old times.” While old times and good friends should not be forgotten, neither should your own financial resolutions.

When hearing this song at the stroke of midnight, many of us may reflect on where we stand with our job, life, health, money, retirement, family and relationships. Maybe there is something to be said about urgency of the clock counting down and the calendar turning over to the next year.

The items that top most New Year’s resolution lists are typically led by eliminating bad habits to possibly starting new endeavors. We all know the usual suspects: stop smoking, drink less, lose weight, watch less TV, be less stressed, stop overspending, reduce clutter, get a better job, join a gym, read more books, start a new hobby and take a vacation appear on many lists.

The fact that most financial resolutions check-lists have very limited financial “to-do’s,” should not come as a surprise. A past study by Allianz Life found that 84% of adults left financial planning off their list entirely.

Getting your financial life organized and up to date takes time, patience and hard work. Do not expect to cruise through life while assuming your financial goals will somehow miraculously be met before or during retirement from hitting the lottery.

With most people experiencing a 30+ year retirement and living longer lives well into their 80’s and 90’s, don’t leave anything to chance. Always remember the adage to “pay yourself first” while living within your means.   

As our world becomes more interconnected and technology-advanced from the “sharing” to the “gig”-economy, staying ahead of the curve may involve a different way of thinking no matter what your age. A recent study by Intuit predicted that by 2020, 40% of workers would be independent contractors.

The following are our top 40 financial hacks to help enhance your financial wellness & your money mindset.  

  1. Develop a side-hustle you are passionate about -before and after retirement
  2. Don’t be afraid to flex your entrepreneurial skills in today’s “gig- economy.”
  3. Become “tech-literate” as tech will continue to integrate into every part of our lives
  4. Master “financial literacy” and education- as it’s not taught at home or in college
  5. Stay active as you age. Your health effects your wealth and your wealth effects your health
  6. Track your household cash flow on excel or with a budget-app like Mint
  7. Develop a disciplined money mindset in today’s instant gratification society
  8. Don’t financially compete with friends on social media. It’s not a competition
  9. Live within or below your means to help get – and stay rich
  10. Refinance down any debts or obligations over +6% to a low fixed rate while you can
  11. Check your credit report three times per year for free
  12. “Freeze” your credit online to help avoid identity theft
  13. Decrease your pay-stub exemptions if your tax-refund is over $2K
  14. Multiply your (age times your income) & divide by 10 to benchmark your net worth
  15. Target 15X the average of your last 5 years of salary for your retirement nest-egg savings number
  16. Limit your retirement income distributions to 4% or less of your portfolio
  17. Subtract (100- your age) & invest the difference in stocks- as benchmark for your asset allocation
  18. Implement a portfolio (and 401K) audit at least quarterly for strategy, costs and performance
  19. Don’t chase performance, star-ratings or published “best-of” lists when investing
  20. Don’t invest in anything you don’t fully understand. There is no such thing as a free lunch
  21. Don’t chase high income or high return investments or products (see #20)
  22. Don’t follow the herd. By the time you hear about something its often too late
  23. For every buyer there is a seller on Wall Street 
  24. Don’t let feed and greed dictate your investment decisions
  25. Plan wisely today for your tomorrow. You can’t put your retirement on a credit card.
  26. Envision your “future you” in retirement. Write down your goals outside the numbers
  27. Develop a road map to know where you are going and benchmark annually
  28. Be accountable. What gets measured gets done
  29. Use employer bonuses and tax returns wisely
  30. Don’t invest more than 10% of your money in employer stock
  31. Maintain 12 months of cash reserves for emergencies and short term goals
  32. Overcome procrastination, fears and excuses
  33. Don’t enroll in Social Security at age 62 unless necessary
  34. Absolutely do not take a loan from your 401K
  35. Put your savings goals on “automatic”-save 15% of each paycheck
  36. Don’t leave a “free” 3%-5% employer retirement plan match on the table
  37. Eliminate debt over a set time-period -make extra mortgage and car payments
  38. Protect what’s important with insurance and estate planning strategies
  39. Review your cable and other household bills and look for ways to cut back
  40. Put your home on “automatic” to save energy and money (thermostat, sprinklers, pool, etc.)

For more information on our firm or to request a complementary consultation please email [email protected] or call (561) 210-7887 today. Collaborate with me on Twitter @jonulin 

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IMPORTANT DISCLOSURES

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing.