New Year 2023: 11 Financial New Year's Resolutions To Save More Money in 2023

Only a few days are left for 2023 to kick in, and it's time to reset yourself. The new year is a time for reflection and setting goals. Whether you want to get in shape, learn a new skill, or make a plan to save money.

Maybe you like the idea of a fresh start, or perhaps you¡¯re tired of the whole ¡°new year, new me¡± mindset. As inflation rises to its highest rate in a decade, many of us are making financial resolutions for the year ahead.

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As per the People Magazine report, around 73 percent of Americans had at least one money-related New Year¡¯s resolution in 2021, and in the last few years, nearly half of Americans wanted to save more money, and a third wanted to improve their credit score.

So, if you¡¯re gearing up to create your list of New Year¡¯s resolutions, consider adding a few goals that are related to your personal finances.

Resolution 1: Track your expenses

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Reducing unnecessary spending is one way to cut your expenses. You can use expense management apps that automatically detect all your expenses done through net banking, debit cards, and credit cards. Moreover, it also automatically classifies these expenses into various categories, such as shopping, food and drinks, transportation, and recreation, which makes it easier for the user to view their expenses in each category. A simple glance helps you figure out your major spending. It displays them in the form of a pie chart, so even a non-finance person can easily understand it. This can help you analyse which areas need attention and reduce those expenses over the next day or week.

Resolution 2: Curb unnecessary spending

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One of the smartest things you can do every month to save money is to comb through your monthly expenses and see where you can cut costs, i.e., mark your wasteful expenses. On average, individuals spend 38 percent to 40 percent of their earnings on household expenses.

Resolution 3: Update your old financial goals

Update your financial goals based on your future spending and investments. When was the last time you reviewed them? If it hasn¡¯t been any time recently, then maybe it is time for an update. Make your financial goals as clear as possible. For example, it could be as specific as "I want to be out of credit card debt and I want to save Rs 50,000 by the end of the year."

Resolution 4: Save every month by the 50/30/20 rule

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An important aspect of your budget is understanding how much you plan to save. You must plan for emergencies, so you must determine how much you intend to put in your emergency fund and your savings. Put something away every month, regardless of how much or how little. At least 20 percent of your income should go towards savings. Meanwhile, another 50 percent (at maximum) should go toward necessities, while 30 percent goes toward discretionary items. This is called the 50/30/20 rule of thumb, and it provides a quick and easy way for you to budget your money.

Resolution 5: Build an emergency fund

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Managing unexpected circumstances such as medical emergencies, job loss, home renovations, or automobile repairs can be difficult. To prepare for such situations, you can build an emergency fund by setting aside a part of your income. An emergency fund enables you to handle unexpected financial needs without straining your regular cash flows or disrupting your financial plans.

Resolution 6: Try lowering your energy and fuel bills

Turn off appliances and lights when they are not needed. Purchase energy-efficient light bulbs. When you can, use a fan instead of air conditioning or put on a sweater instead of turning on the heat, and try public transportation or sharing a cab for travel instead of a personal vehicle to save on your monthly fuel expenses.

Resolution 7: Start the process of reducing your debt burden

Nowadays, borrowing money has become much easier due to digitalisation. The young ones hold several credit cards and can also get easy access to personal and other loans.

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However, easy access to credit has significantly taken away financial discipline. It has resulted in haphazard spending, reducing the level of savings. To reduce the debt burden, primarily check the total amount of liability you owe and list down your debts, such as credit card bills, personal loans, car loans, education loans, etc., and start the process of reducing them.

Resolution 8: Secure your family with health and life insurance

An insurance plan is one of the ways in which you can secure the future of not only your children but the rest of your family too. It is very much like the fire alarm in your building, which may not be used on a daily basis but can be a lifesaver when it detects certain levels of smoke that could be an indication of fire.

There are many types of insurance plans, but the most important one you should consider opting for is life insurance. You need to understand the uncertainties of life and plan for the financial security of your loved ones.

Resolution 9: Investing in a plan

Making an investment plan involves more than just choosing a few stocks to put money in. You have to consider your current financial situation and your goals for the future.

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It¡¯s also important to define your timeline and how much risk you¡¯re willing to take on in order to determine your optimal asset allocation. All of these steps help mitigate any risk you might encounter in the stock market. In turn, planning before you invest your hard-earned money is extremely wise. This may require a lot of research or consulting with a financial advisor to help you through your unique financial situation.

Resolution 10: Build up a retirement pot

It really is never too early to start saving for your pension. The reality is that the earlier you start to build your pot, the better.

Royal London pension specialist Helen Morrissey says: "Pensions are not just for old people. You are never too young to start a pension."

Resolution 11: Make It Realistic

If your goal is to start saving or investing, and you¡¯ve never done it before, don¡¯t set the bar too high. For investing, a realistic goal may be to try to save a certain amount each month or year.