7 Money Must-Haves for 2016

As we usher in the year 2016 with an optimistic outlook for a bright future, we must have a
decisive game plan to create a more prosperous New Year. Instead of just rehashing wishful resolutions from past years, make a concerted effort to attain these specific financial objectives:

1. A S.M.A.R.T. goal

It’s been said that ‘a promise is a comfort to a fool’; and some people believe that resolutions are foolish wishes that bring cold comfort. Your dreams may seem impossible to achieve if you don’t convert your ideas into specific, measurable, actionable, relevant and time-based goals.

Select one dream that would make the biggest difference in your life. Write it down precisely, expressing how you would measure it, take action on it and know when it was complete. Consider all the steps you need to take every day to realise your goal and persevere until you accomplish it.

2. A working budget

To become more organised with your finances this year, you need to utilise a proper budget. Without a detailed spending plan outlining all the costs you expect to incur during a year, you won’t know how best to allocate your money, or whether your income will be sufficient for your needs.

Download a budget spreadsheet at financiallysmart.org and fill out the expense checklist. Convert all your figures in average monthly expenses and calculate how much you need to earn to pay for your lifestyle. Make adjustments to your spending plan to balance your budget.

3. A savings habit

Despite the challenges you may be facing in meeting current bills, you still need to put aside some of your income if you want to have a better future. If you don’t focus on accumulating money, you will continue to spend everything you earn and have nothing left to create wealth for yourself.

Make a firm commitment to save something, even if it’s just J$500 per month, and stick to your pledge throughout the year. If you have no income, gather loose coins whenever you find them and put them in a clear container every day. Your aim is to develop the habit of building a nest egg.

4. An extra income target

In these tough economic times, it can be difficult to accomplish all your objectives with a single income source. To counter the constantly rising prices, you can try to cut back on expenses; but to maintain or improve your standard of living, you have to look for ways to boost your earnings.

Your budget will help you to see how much more money you need to meet your bills and save for goals. This extra income figure can be broken down into weekly or daily earning targets. Use your talents to create value for others and look around your surroundings for earning opportunities.

5. A critical insurance policy

We live in a time when lifestyle ailments such as diabetes and hypertension are prevalent, so you must be practical about how illness can derail your financial wellbeing. The cost of treating a serious or chronic malady can wipe out all your savings and put you in debilitating debt.

You can reduce your financial exposure to these health challenges by buying critical illness policies. These plans will provide a lump sum if you are diagnosed with stroke, heart disease, cancer and other ailments, which can help you to afford the expensive treatment process.

6. A realistic retirement plan

Most of us dream of a time when we can put a halt to the daily grind of work and comfortably retire. However, few people actually prepare for this desired retirement bliss by making a plan while they are still working, to produce the income they will need when they want to stop working.

If you aren’t contributing to a workplace superannuation fund, then you can join an approved retirement scheme which allows Jamaican residents to save up to 20 percent of their pre-tax income. Some retirement funds have flexible terms where you can save whatever you can afford.

7. A valid will

Whether you like to think about it or not, the time will come when you must pass from this earth. If you haven’t made any provisions to distribute your money and possessions, then you will be setting up your loved ones for financial distress and disaster if you die unexpectedly.

It may be sufficient to prepare a written will which outlines your intentions for how your assets should be transferred. For a valid will, you must appoint an executor to carry out your wishes and have it signed by two witnesses. It your estate affairs are complex, then it’s best to seek legal help.

You can get more detailed explanations on the steps required to fulfill these objectives right here on this blog and in my new eBook, The 3 M’s of Money: How To Manage, Multiply and Maintain Your Money. If you include these money must-haves on your bucket list to accomplish this year, you’ll be on the road to having a more financially successful 2016!

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Copyright © 2016 Cherryl Hanson Simpson. No reproduction without written consent.
Originally published in The Daily Observer, January 7, 2016.

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Cherryl is a money coach and business mentor, and founder of Financially S.M.A.R.T. Services. See more of her work at www.entrepreneursinjamaica.com and www.financiallysmart.org. Contact Cherryl