Do you make New Year’s resolutions? Do you keep them?
First, a little history on resolutions. Some 4,000 years ago, Babylonians began each year by promising their gods they would return all borrowed items and pay off any outstanding debts. 2,000 years later, Romans, encouraged by Julius Caesar, opened each year by praying to their god Janus, after whom the month of January is named.
Today, millions of Americans make resolutions every year. According to the website, Statistic Brain, the five most popular New Year’s resolutions are:
- Lose weight.
- Get organized.
- Spend less, save more.
- Enjoy life.
- Get healthy or fit.
Are you interested in making a resolution that could improve your finances? Here are 4 worthwhile vows that could well brighten your financial future in 2017, and beyond.
1) Get Your Employer Match
While your grandparents probably had a pension, you likely have (or had) access to a 401(k).
But are you leaving free money on the table?
About 95 percent of 401(k) plans offer some sort of employer match. Let’s say your company offers you a 100 percent match, with a cap at 6 percent of your salaried contribution. If you are 50 years old and make $150,000 a year, and you can manage to contribute $375 per paycheck for 10 years, your employer would be kicking in an additional $90,000 toward your retirement.
2) Pay Off Your Mortgage the Day You Retire
I’m a huge proponent of retiring debt free, and this includes doing everything you can to pay off your mortgage before you retire.
Do you want to stop working in 5 years? Or maybe 10? How much extra would you have to pay each month to retire without a mortgage? Use Bankrate’s simple mortgage payoff calculator, and then make a New Year’s resolution to automatically “up” your monthly payment and retire mortgage free.
3) Get Your Finances in Shape by Exercising
Here’s a completely original New Year’s resolution: begin to exercise. (I take it you’ve heard this one before.) But there’s more to it than meets the eye.
According to numerous studies and surveys on the subject, people who exercise, or people who start to exercise, even in mid-life, end up wealthier and live longer than people who don’t exercise.
First, even walking 1.5 miles (20 minutes) 4 times a week, should:
- Improve your overall health.
- Boost your energy.
- Decrease stress.
- Improve your sleep.
- Help control your weight.
- Increase blood flow to the brain.
It’s pretty straightforward: Exercise helps you feel better, think more clearly, and it improves energy. Those factors can go a long way toward helping you to make better life and financial decisions. Want more proof? Finnish researchers recently studied 2,500 sets of twins and discovered that the twin who exercised regularly actually earned more money, and reported higher life satisfaction levels, than the more sedentary twin.
4) Meet with Your Financial Advisor
If you’re a client of Hanson McClain, you know we place a premium on updating your financial plan when you experience major changes in your life.
But what if you don’t have an advisor?
A good advisor proactively monitors your investment allocations to help you account for fluctuations in the economy or markets, but have your financial goals or your life recently changed? Are you getting married or divorced? Do you need to update the beneficiaries on your retirement accounts? Have you purchased a new house, gotten a raise, started a new business, or taken a new job? Is a child getting ready to graduate from college? Have you or your partner experienced a health setback?
When you experience a major life event, or when your goals or your financial situation changes, you need to speak with an advisor.
Your finances, your New Year’s resolutions, and your health could very well all be related. With 2017 upon us, now is a great time to determine not only what you need to do to keep your finances on track for the future, but to make a vow to improve your health from this moment forward, as well.