2021 Financial Resolutions for Missouri Residents

Many Americans renew the tradition of creating a list of New Year’s resolutions. The sale of exercise equipment spikes and many people adopt a “dry January” or other health-conscious endeavor. Sometimes, though, the healthiest resolutions focus on your finances. By creating short-term and long-term financial goals, you can use 2021 to pay off debt, increase your retirement savings, or fund your dream vacation or home. At BTC Bank, your financial health is a top priority. Financial resolutions can help relieve stress and create a happier future for you and your family. Here are the top ways you can achieve your financial goals this year.

Keep a Budget

Everyone knows that having a plan can increase the likelihood of achieving your goals. When discussing financial goals, that plan is called a budget. If you aren’t already tracking your monthly income and expenses with a budget, don’t be intimidated by the idea. A budget is simply a record of how much money you gain each month (income) and how much money you lose (expenses). Apps like Mint can help you create and track your budget, or you can keep it simple with a notebook or spreadsheet. For some advice on creating a budget, NerdWallet can help.

To find ways to save money in the new year, examine your current expenses. Rank your expenses from most important to least important, and try shaving some dollars off the categories that you can live without. Don’t forget to examine your current digital subscriptions and automatic payments. Be conscious about every purchase, and don’t let money slip through the cracks each month. When you save money, you’re paying the most important person -- yourself!

Plan to Pay off Debt

Nothing drains your income faster than high interest rates on debt, yet credit card use has become part of the American lifestyle. In the third quarter of 2020, the average household credit card debt was $7,849. While that’s actually a decrease from previous years, credit card debt remains a huge burden for most families. Whether your debt consists of credit cards, personal loans, student loans, or medical bills, make a plan to pay down some debt this year. Here are the top tips for paying off debt in 2021.

• Organize all of your debts based on interest rate.
• Focus on paying off the debt with the highest interest rate first.
• Make your debt payment a permanent line in your monthly budget.
• Celebrate your efforts with a debt payoff countdown.
  
  

Set Achievable Goals

While the resolutions “save money” and “lose weight” sound great, experts agree that successful goals are SMART. SMART goals are: Specific, Measurable, Achievable, Realistic, Timely. A short-term, financial SMART goal could state, “I’m going to pay an additional $200 towards my student loan in January.” Whereas a long-term SMART goal could say, “I will save an extra $1,500 in my IRA this year.” Once you have a goal, use your budget to create a plan to achieve it.

Monitor Your Credit Score

While you’re keeping a close eye on your 2021 finances, plan to check your credit report on a regular basis. Some financial apps allow you to monitor your credit score constantly. While constant monitoring may be interesting, you don’t need to check your credit report more than once a year. AnnualCreditReport.com is the official, trustworthy site for your annual reports. Start the year off with reports from the three main credit reporting companies: Equifax, Experian, and TransUnion. Check your reports for errors and suspicious accounts. Improving your credit score will help you save money on future loans and mortgages.

Save and Invest Your Money

The new year is a great time to refresh your financial portfolio and consider new ways to save and invest your money. Do you have a checking account and a savings account? Both are important tools in your financial portfolio. Beyond the basics of checking and savings are longer-term savings devices. CD’s, IRA’s, and HSA’s can be used in different ways to increase your savings and financial health. Examine any savings tools you currently use and consider upgrading or branching out to new investments this year. 

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Investing in mutual funds and stocks isn’t as scary as it seems. Wealth managers can guide you in the right direction whether you are looking for safe long-term investments or riskier short-term investments with the potential for big gains. Even if you currently have a stock portfolio, make a resolution to check your accounts and explore the best ways to invest your money in 2021. Investment Portfolio Management Services at BTC Bank can help you keep a balanced portfolio that aligns with your goals and time frame. Whether 2021 is the year to start saving for your kid’s college expenses or an opportunity to pad your retirement fund, the key is smart investing.

Focus on Physical Health

If we’re focusing on financial resolutions, why talk about physical health? It turns out that resolutions related to your fitness level and diet might actually help you achieve your financial goals as well. A 2016 WalletHub study found that people who exercise frequently have the best credit scores. Exercising and eating right can help you stay healthy and avoid costly trips to the doctor’s office. The U.S. Bureau of Labor Statistics found that the average American spends $5,193 on healthcare each year.

Grow Your Financial Knowledge

Becoming financially literate is wonderfully easy thanks to the internet. Whether you want to learn more about investing in the stock market, budgeting, paying off credit card debt, or saving for college, the information is out there. Financial experts are blogging on their websites, writing books available at your library, and answering questions on their podcasts to bring you the information you need. Choose a topic that interests you and make 2021 the year that you grow your financial IQ. A quick internet search will provide you with some leads. Find an expert that is easy to understand and answers your questions. Before you know it, friends and family will be asking you for financial advice!

Reach Your Goals

When it comes to financial resolutions for Missouri and Iowa residents, BTC has the insight and advice to help you succeed. Identify the areas that you would like to improve in 2021, and our friendly associates will connect you with the right financial products and services. New Year’s resolutions in Missouri are easy to achieve with the help of your community bank. Call 1-877-BTC-BANK toll-free or contact us today to speak with a knowledgeable professional at a BTC Bank near you.

For more investing information or to schedule an appointment, contact one of our local Investment Advisors toll-free at 1-877-BTC-BANK. Aim high in 2021 -- we’re here to help!