Alicia Adamczyk, CNBC (Make It)
There are 100 days left in 2019. That’s 100 days to finally complete the New Year’s resolution you made back in January, get back on track if you’ve faced a financial setback this year or make some completely new money moves.
So, what can you accomplish in your final 100 days before 2020? Here are four ideas.
1. Set up auto-savings
Virtually every financial expert out there recommends automating your savings and investments. That means scheduling transfers of money from your checking account to your savings account each week or month, and having money deposited directly from your paycheck into retirement accounts like a 401(k) or IRA.
Automating your finances is “the one step that virtually guarantees that you won’t fail financially,” writes wealth manager David Bach in “The Automatic Millionaire.” “You’ll never be tempted to skimp on savings because you won’t even see the money going directly from your paycheck to your savings accounts.”
Doing so, whether through your bank or a financial app like Digit or Albert, takes about five minutes. Easy enough to accomplish in the next 100 days.
You can start small. Even contributing $10 to your savings or investments every week adds up over the long run. If you already automate your savings, then increase the amount or add a deposit.
2. Check your fees
“Americans could be paying more than $369,000 in fees over their lifetime for their workplace retirement plans, individual retirement account plans and checking and savings accounts,” CNBC reported in 2018. But it doesn’t have to be that way.
While investing can help your earnings compound, fees compound, too. Minimizing fees on your investment portfolio is one of the most important things you can do to build wealth. One way to do this is to invest in low-cost index funds with expense ratios well below 1% (the Vanguard 500, the largest index fund out there, has an expense ratio of 0.04%). You can check a fund’s expense ratio in its prospectus, or by simply searching ”[Fund name] + expense ratio” in Google.
There are also other fees to cut out of your life, if you can. Paying a monthly fee to your bank for a checking or savings account? Get a new bank. There’s no reason to pay any sort of management fee when there are plenty of reputable, no-fee bank account options out there.
3. Cut back one category of spending
Millennials spend an average of $838 a month on unnecessary expenses. What are you wasting money on? It might be an inflated cable bill, monthly subscriptions you forgot about or maybe you’re spending way too much at restaurants and bars.
Take some time before the end of the year to audit your finances and find out where your problem areas are. One way to do this: Rank your nonessential expenses according to how much you value them. Then try to cut back on the categories that make up the bottom of that ranking for the next 100 days and see how much money you save.
You can also institute some “no spend” rules for your budget for the next few months or finally cancel any recurring subscriptions or memberships that you don’t take full advantage of.
Track your spending to see the full results at the end of the year and consider diverting your savings into a “sinking” fund for future expenses.
4. Make a plan for 2020
The new year will be here before you know it. Now is a good time to take stock of your financial year in full and see where there’s room for improvement.
Maybe you didn’t put as much into your IRA as you would have liked. Maybe you want to get your credit card debt under control. Whatever is top of mind for you, take the time to plan how you will approach it in the coming year. While 2020 might be 100 days away, no one says you can’t get a head start on your new year goals now.
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