MIAMI VALLEY — A lot of people do New Year’s resolutions to start the new year.
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One of the top resolutions is to save more money, according to the website, statista.com.
Financial resolutions are popular every year, but especially this year.
News Center 7 Consumer Reporter Xavier Hershovitz broke down with advice from an expert on News Center 7′s Daybreak.
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The New Year brings all kinds of resolutions and when it comes to getting your finances together or even saving money, it all starts with how people spend it.
Hershovitz spoke with Rob Burnette, the CEO of Outlook Financial Center in Troy.
He said that the important thing you can do is put together a spending plan.
That is a dollar-by-dollar breakdown of how you spend your money each month.
It may sound like a lot of work, so where do you start?
“Fill out a spending plan on what you think you’re spending. Start there,” said Burnette. “Then for the next 30 days, meticulously record every expense. If you pull $40 out of the ATM, I want to know how you spent that $40.”
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He also told Hershovitz that people should compare “what they thought they spent” versus “what they actually spent.” From there, they can easily see some areas where they can make some changes.
Burnette also said there are three areas they should focus on to get their finances in order this year.
- Milestones- From buying a car to purchasing a house.
- Create a debt reduction plan- Be methodical and not afraid to talk with those you owe about setting up payment plans.
- Creating and maintaining an emergency fund.
“The last thing you want to do is have to put it on a credit card and pay 30% interest,” said Burnette. “So that’s the whole idea behind the emergency fund, three to six months’ worth of household expenses.”
He says part of the idea of the spending plan is for people to be able to spend their money on things they want, but do so wisely.
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