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New Year, New Budget

December 28, 2023

Two people discussing finances at a coffee table covered with books and a laptop

Did you start thinking about New Year’s resolutions before the holidays even began? You’re in good company.

Many people start thinking about how to get a better handle on their finances in the year ahead while they gear up for holiday spending. In fact, better budgeting is a top 5 “achievable” New Year resolution. But where to start? And what type of budget should you use?

The good news is there are several easy, effective budgeting techniques that can help you spend smarter and save money. The secret is to find an approach that works for you—one you’ll stick with over time. The more you do it, the easier it becomes.

We’ll explain some of our favorite budgeting methods in the weeks ahead.

There are a few important basics that are the foundation of a successful budget, which you can start on today.

  • Set short-term or long-term financial goals. Goals can motivate you to stick to your budget and help you measure progress. Are you aiming to pay off debt as quickly as possible, saving to buy a house, or planning for retirement? Different goals need different spending and saving plans. Goals may change as circumstances change, so it’s good to revisit them periodically.
  • Track income and expenses for a few months. Some jobs have predictable salaries, while freelance, contract, and gig work provide variable income. Expenses can also be fixed (rent, for example) or variable (think groceries). Be sure to track all of your purchases (even cash!) in addition to bills and credit card payments.

Understanding your income and expenses is essential for a good budget. You may even find things you can cut back on right away. Sometimes just tracking what you spend can help you be more mindful and even small adjustments can add up to big savings.

Take time during the holidays to prepare, so you’re ready to budget better as of January 1. You’ve got this!

Visit RCU’s Financial Education Center to find more useful resources on achieving your financial goals.