In every sense of the phrase, 2020 has been a wild year.

While all news isn’t terrible, a lot has been, so if you’ve made it to the end of 2020, let’s just say it was an impressive feat.

With this year coming to a close, what does 2021 have in store for us? How do we prepare for the new year in hopes to make a better one than the one we’re leaving behind? At Fyvie Financial, we believe that the foundation of every good plan starts with funding. If you’re an individual setting your New Year's resolution to accumulating more wealth, learning how to review and build your financial goals is key in getting ready to achieve them.

If you’re ready to make 2021 one of the most financially successful years of your life, keep reading to discover how you can do so in three simple steps.

Review your 2020!

If you haven’t gotten into the habit of your keeping track of your receipts from purchases (like dining out, grocery shopping or paying bills), log into your bank account that you use for paying your expenses and examine your transactions for the past 12 months. This way you can review exactly what you spent money on each week and/or month and determine how your spending habits either helped or hurt your financial goals this year. Our clients at Fyvie have access to software that allows them to review their spending in all the categories!

Specific details you may want to check for when looking over your transactions for the year are as follows:

● What was the total amount of money you spent on needs vs wants?

● Where did you overspend and by how much?

● If you have a savings account, what’s the total amount compared to what you spent?

Reviewing your statements and cash flow helps you to better understand your money mindset (i.e. your relationship with money and how you use it), as well as get a better grip on your money motivations. As a result of this process, you’ll be able to identify your financial goals and see where you can cut back to meet them.

As COVID-19 is a persistent threat to many households and their income, it’s understandable if you couldn’t attain your goals. Don’t be too hard on yourself. As you enter 2021, consider these small changes to help you improve your perception and reality moving forward.

● Get paid what you’re worth:

A decent paying job is essential to meeting all of your financial needs. If you have a job, but it isn’t paying enough—or if you’re out of work and looking for opportunities—the New Year (specifically January and February) brings a great chance of getting hired at a new job that values your service. Or you can prepare to start your own based on your skills and set your rates to match your qualifications. If you’re in the position of being furloughed or unemployed, look at what help you can receive, locally and nationally, to help sustain you and your family during this time.

● Live below your means:

Cutting back and saving can be difficult if you have a lower income to work with, or if you are a ‘Spender’ who enjoys retail therapy and other money-spending habits. However, living below your means applies to addressing any area in your life where you can stand to save money. This could mean reviewing your auto insurance options, grocery shopping with coupons and pausing those late-night Amazon spending sprees to fit your spending plan.

Prepare your dream spending plan (that includes a savings plan).

You’ve probably heard time and time again that budgeting and saving is the best way to get your finances in order and make real progress on your financial goals—and that’s because it’s true! However, we like to use the words spending plan, and savings plan because it works so much better than the restrictions and mindset associated with the word budget!

Oftentimes, it feels like getting back on track with our finances feels impossible, and that could be due to us failing to realize our money mindset and how it’s working against us. However, if you have the desire to learn how to make your money work for you and build your wealth, the next step is to put into practice.

Creating a spending and savings plan that works for you requires you to do a little bit of groundwork, similar to reviewing your 2020 wallet. This includes calculating your monthly expenses (both needs like bills and food and wants like makeup or video games), your monthly to annual income and learning where you need to save and how. The trick to producing a plan that actually works is to remember this key detail: overspending is forbidden!

Protip: A simple weekly or monthly budget plan looks like this: 70/20/10. This may not suit everyone but is a good starting point!

● 70% of your income (after taxes) goes to necessities and bills.

● 20% of your income goes to savings and/or paying debts.

● 10% of your income goes to you! We like to call this “fun money.” But if you want to throw it into your savings, that’s just as well.

When you take your planning seriously, you’ll be able to save faster (or reward yourself without feeling guilty or losing money) as you are sticking to your guns about your money. In the process, set up a savings plan that you can funnel your unused money into. This savings account can be used as your emergency fund or retirement savings. Either way, you’ll be on track to meet your goals as you inspire yourself to underspend.

Set your goals and live by them.

You know the kind of your life you wish to lead. Packing up your bags and going for that vacation in cross country (or out of country) with your family. Renovating your backyard to include that beautiful rock-lined pool that transforms the area into a serene escape outside your door. Growing your IRA to thousands, if not millions, of dollars to pass on to your children and their children. Whether your goals are big or small, you deserve to see them all come to fruition as your life is yours to make!

Setting your goals inevitably involves your money.

Getting real about your money motivations, and what you need money to do for you, is inspiration to help you live by your spending and savings plan………. and make it happen.

Take the time to write down all your goals for the next six months and this next year. As you get ready to start on the journey to make them happen in 2021, track your progress for each one as you go along. This helps your goals stay fresh in your mind and looking over your hard work keeps you energized to keep pushing until you have what you want.

Though 2020 presented many challenges that may have made being hopeful seem difficult, 2021 is a new year for a new chance to turn things around. If you didn’t cover much ground this year with your financial goals, not to worry! If you begin working on reassessing your goals and setting a plan sooner than later, you’ll be ready to tackle the new year in no time!

Need help getting started or want help creating a plan for all your finances?

Fyvie Financial is your essential resource for all things financial assistance. Whether you need our team to guide you through reviewing your income and crafting a plan which includes taxes for 2021, or if you want to work on your financial goals with a professional, Fyvie Financial is able to deliver you options that suit your needs.

Book your complimentary discovery call today to learn how we can work together to make 2021 your best financial year yet! We’d love to help you on your journey, and if we are already assisting you, don’t forget your biannual check in review or conversation about your upcoming tax position and business or individual tax needs! Schedule all of these calls here.

End of a year, start of a new - creating financial success!