Make a New Year’s Resolution to be better with your money!
This year, resolve to increase your financial literacy. Students and parents can all be better at managing their money, and now is the perfect time to start! Here are some examples of money resolutions:
Pay Off Debt:
To pay off debt faster and save the most money on interest, you must pay more than the minimum payment required on student loans, credit cards, mortgages, car loans, etc. Try to cut back your monthly expenses such as eating out, movies, concerts, etc. by $20 or $50 a month and put that extra money toward paying off your debt. Students can even begin to pay off their student loans while they’re in school- they don’t have to wait until they graduate! To save the most money, put the extra payment toward the debt with the highest interest rate. This method will save you the most money in the long run. If you are having a hard time staying motivated to pay off your debt, put the extra money towards the debt with the lowest balance, to pay it off quicker and gain some momentum.
You probably have some financial goals that you want to save for. For parents, it could be a family vacation, another child’s college fund, retirement, an emergency fund and more. For students, goals might include a spring break trip, a new car, books for next semester, moving expenses after graduation, etc. To create a financial goal, estimate how much the goal will cost you. Next, determine how long you have to save up for that financial goal. Finally, divide the amount of the goal by the number of months you have to reach that goal. This number will tell you how much you need to save each month to reach the goal on time. You may also need to cut back on spending in order to save enough to reach your money goals.
Need more money resolution ideas? Check out this article from cheapism.com. Having a money resolution can motivate you to decrease your spending to achieve paying off debt or saving more money. If your student needs help with money problems or questions, they can go to unl.edu/smmc to check out our 300+ money resources or schedule a confidential, one-on-one financial advising appointment with us at the Student Money Management Center.
Article originally posted on the UNL Parents Association January 2016 Newsletter