The new year is almost upon us. For some, it might be hard enough having to navigate the festive season, never mind whatever awaits around the corner in 2022. There’s no denying that finances in many households are tight, and after two years of being bombarded with disease; uncertainty; and dramatic shifts in lifestyle, culture, and general interactions, it might feel too draining to try and plan for the future. But the reality is it’s never a good idea to stick your head in the sand, and regardless of what 2022 might hold, it may be just the year for you to actively work towards financial wellness.
In fact, adopting just one habit in the new year could set you on a course towards gaining better control of your finances and, over time, possibly reaching not only financial security, but financial flourishing. That habit? Building awareness.
Take off the blinkers
In theory, most of us know that setting and sticking to a budget, spending less than we earn, and finding passive sources of income are important. In reality, doing this can be much harder. But rather than carrying on as usual and hoping things will improve on their own, being purposeful and disciplined is what leads to better results. You can, however, only be disciplined if you are awake to the issues and what needs to change. Then only does it become easier to set goals and envisage a brighter future towards which you can work.
And this is where adopting financial software can assist, as the best personal finance software applications on the market today can help you gain a much-needed overview of your financial reality. This kind of software allows you to input your monthly and other expenses, list your income streams, identify your different accounts (if you have more than one), and build a profile of your current financial situation based on past activity. You can also track your current spending and saving habits, set specific financial goals, and put guards in place to prevent you from overspending. Some applications further enable you to better manage your monthly payments to avoid late charges and/or lower your risk of ending up in overdraft.
Using personal finance software not only helps you build a picture of the past to see where you can improve and set better current practices, but you can also picture where you want to be in the future. Setting long-term future goals like how much you’d like to be earning in 5 years’ time or how much you want saved for retirement can really help you accept the concept of delayed gratification. By building the habit of being constantly aware of what you’re doing with your money, where its going, and how a certain action might either help or hinder your progress can go a long way to gaining financial freedom. So why not take up this habit in the new year – it’s never too late to start.