Starting 2024 Right: Eight Financial Moves You Need to Make
Welcome back, everyone. It's that time of year again. Every year, I start the new year with a video about money. And I'm excited to do it again this year. So let's get started.
So, 2023 was a wild year for money. We saw the housing market hit lows we haven't seen in years. We saw student loan forgiveness not happen. We saw recession fears and rising interest rates. It was a lot.
And as we head into 2024, there's still a lot of uncertainty out there. It's an election year, which always brings its own set of financial unknowns. So, it's more important than ever to be prepared for whatever comes our way.
So, here are eight things you need to do differently with your money in 2024.
The first thing you need to do is get on the same page with your spouse. If you're married, you need to combine your finances. Now, I know this is going to get me some backlash in the comments from people who think that combining finances is a bad idea. But I've seen it work for so many couples.
I've seen couples pay off their debt together and achieve financial goals they never could have reached on their own. I've seen couples who were on the brink of divorce turn their marriage around by working together financially.
And there's research to back this up too. A study of millionaires found that working together with a spouse was one of the key factors in their success.
Now, obviously, there are exceptions to this rule. If your spouse has an addiction problem or if they're abusive, then you should keep your finances separate. But for most couples, combining finances is the best way to go.
The second thing you need to do is get on a budget. A budget is just a plan for your money. It gives every dollar a job to do before the month begins.
As John Maxwell says, "A budget gives purpose to every dollar." And when you give every dollar a purpose, it feels like you got a raise.
I can't tell you how many people have told me that they felt like they got a raise when they started budgeting because they were finally telling their money where to go instead of wondering where it went.
And if you think budgets are just for poor people, think again. My company has budgets for every department and every project we do. And we're not poor.
The third thing you need to do is pay off your student loans. Student loans are the worst kind of debt because they tend to linger forever if you don't make them a priority.
So make them a priority and get rid of them as fast as you can.
The fourth thing you need to do is protect your emergency fund. Your emergency fund is for emergencies only - things like job loss or medical bills or car repairs.
It's not for things like vacations or home renovations or Christmas presents. If you use it for non-emergencies, then it won't be there when you really need it.
I haven't touched my emergency fund in decades, and just knowing it's there gives me peace of mind.
The fifth thing you need to do is obtain term life insurance through Zander Insurance. Term life insurance is one of the best ways to provide security for your family in case something unexpected happens to you.
Zander makes it easy and affordable to get the coverage you need so that your loved ones will be taken care of no matter what.
The sixth thing you need to do is try out a new side hustle. Increasing your income is one of the best ways to create more financial margin in your life, especially if you're still on baby steps 1-3 in my plan.
In fact, 98% of debt-free screamers increased their income during their journey to debt freedom by picking up extra work or starting a side business.
So find something you enjoy doing and see if you can make some extra money doing it.
The seventh thing you need to do is prioritize contentment. Contentment means being happy with what you have instead of always wanting more.
When you're content, you're less likely to go into debt trying to buy things that will never make you happy anyway.
And when you're content, you'll have more financial freedom to be generous and invest in things that really matter.
The eighth thing you need to do is be aware of lifestyle creep. Lifestyle creep happens when your spending increases as your income increases.
It's easy to fall into this trap without even realizing it, especially if you get a raise or pay off some debt and suddenly have more money coming in each month.
But if your spending goes up at the same rate as your income, then you'll never get ahead financially and will always feel stressed about money no matter how much you make.
So be intentional about keeping your spending in check so that you can build wealth and live the life of your dreams without going into debt or living paycheck-to-paycheck.
And remember: You don't have to buy everything right now just because someone else has it right now!
Finally, here are some guidelines for buying a house:
- Be completely debt-free (including paying off your mortgage) before buying another house.
- Have an emergency fund of 3-6 months' worth of expenses.
- Buy on a 15-year fixed-rate mortgage with payments no more than 25% of take-home pay.
- Don't buy until Baby Step 7 (build wealth and give).
No matter where you are financially right now - whether things are going great or whether things are really tough - there's always hope! You have the power within yourself to change your circumstances and reach your financial goals!
If any of these steps seem overwhelming or impossible right now, I encourage you to take one practical step today toward taking control of your money and changing your future! One simple step could be signing up for EveryDollar budgeting app!