2021 – a much-anticipated bright new year. Want a new start with this new year…especially after 2020? Start off with a bright financial future by committing to these financial resolutions in 2021.
- Create a budget
- Make a savings buffer.
- Start saving for PCS now.
- Make the most of credit cards.
- Pay bills when you get them.
- Stick to the planned budget.
- Get the kids involved!
Create a Budget
This isn’t easy. You need to know what you need to spend on things like groceries versus what you want to spend. There a bounty of budget sheets on Pinterest. Check your base resources to see if there is a financial Military Family Life Counselor (MFLC) as he/she may also have free resources and information, inclusive of a budget book. Don’t have a MFLC on base, check out Military One Source to talk to a financial counselor. A financial MFLC can even sit down and review personal goals. Living on a Navy or Marine Corps base? If you are having a baby, check out the Navy Marine Corps Relief Society who provide services to complete one-on-one budget counseling through the Budget for Baby classes. There are many free resources including monthly spending sheets, bill trackers and expense lists to help build a budget.
Make a Savings Buffer
This can be done in small increments, and doesn’t have to be a big chunk all at once. If you can save just $10 a week, that will add up in the long term to $2,600 in 5 years, and that’s not counting interest! An emergency fund of 3-6 months of expenses is recommended as a buffer in case there is a job loss, or any other type of emergency. Thankfully, in the military, there isn’t a usual loss of job immediately, but starting the habit now of having that savings buffer will create lifelong healthy financial habits.
Start Saving for Your PCS Now
PCS – Permanent Change of Stations or Permanent Change of Sanity level – you choose. Moving is not easy emotionally or financially. According to the Military Times, military families lost about $5,000 out of pocket each move. Normal “costs” associated with moving are outlined further by Military.com and that doesn’t include all the wild expenses of loss during a move.
Make the Most of Credit Cards
If you have a card you love, make sure you are using all the benefits. There have been credit card changes over the last year – cards that typically favor travel have been offering credit on TV streaming services or exercise apps. Use these benefits to save money! If your card gives you cash back, consider using the bonus to pay off your bill if you have a big ticket item like a new appliance. Credit cards can be useful if you are paying off your bill monthly and can utilize the benefits.
Pay bills when you get them.
Going off the previous paragraph – in order to use the benefits of credit cards, you often have to not carry a balance. When you get the bill, pay it off if you are able to. APR, the annual percentage rate, that credit card companies charge for any amount not paid off by the due date. There is also a late fee! That $100 amount not paid off may then add up to $149, and that’s only in one-month period. There are some cards that have a 0% APR offering for a year, and these can be helpful in purchasing big items like a new fridge or freezer so you can pay off a little at a time monthly. But make sure to put a calendar alert to know when the APR will begin to avoid those charges.
Stick to the planned budget.
This can be hard. It will require planning and understanding of your budget. If next month you know you need to pay for movers for that PCS and didn’t have time to build up a PCS buffer, consider cutting out a few things so you can stick within the budget for the next month. Maybe stop the $5 daily coffee habit for that month. As most military families know, unexpected things happen, but beginning the habit of sticking to that budget will get easier over time.
Get the kids involved!
It’s never too early to start learning about saving. In as early as second grade, children in U.S. schools are learning about the economy in basic terms of imports and exports and the “costs” and “savings” associated with them. Getting children involved early helps build financial attitudes of understanding. The Mint offers free resources for kids and teens to learn about earning, saving, spending, giving, investing, tracking money and more.
Military One Source is a great resource for anyone – CONUS to OCONUS. Free online financial resources are available at MilSpouse Money Mission and popular tools from Dave Ramsey can be requested here.
What is your favorite financial tool?