It’s the new year. The gym is packed with people trying to lose weight. Health food stores are packed with people trying to eat better. Even bookstores and libraries are packed with people who made the resolution to read more.
But one of the most popular resolutions is to get personal finances into order. Below are six steps you can take to become more savvy, educated and responsible with your finances.
1. Get your free credit report
It all starts here. Visit AnnualCreditReport.com to receive a free copy of your credit report every 12 months from each credit reporting company. Your credit report can affect the rates you receive on home and auto loan rates. It can be the deciding factor on whether or not you get approved for a credit card or any other type of loan. It can also be the difference between a “yes” or “no” decision on an apartment rental or a new job.
Viewing your credit report is also the best way to see if it has any incorrect information or if you have been the victim of any fraudulent activity, such as someone opening new accounts in your name or making unauthorized transactions on current accounts.
If you haven’t looked at your reports in the last couple of years, you may want to order all three at once. However, if you suspect that you may be a victim of ID theft or if your Social Security number is compromised in a data breach, consider staggering your reports by ordering one every four months.
2. Pay off your credit
Maybe you put all of your Christmas shopping on a credit card. Maybe you had a couple of emergency expenses and your credit card is maxed out. No matter how you got into debt, the best course of action is to get out of it. If you leave high balances on your cards and only pay the minimum every month, your interest charges will skyrocket.
Make it a goal to pay more than the minimum on your credit cards each month. Use our free monthly loan payment calculator to see long it will take you to get out of debt depending on how much you pay each month, assuming you won’t make any more purchases with your card.
3. Consolidate or refinance high-interest debt
Do you have so much debt that it looks like you’ll never see the light at the end of the tunnel? Consolidate it. Arsenal offers personal loans and home equity loans that turn your many monthly payments into one, easy-to-manage monthly payment with a fixed interest rate, making it easier to get out of debt.
If you have a high balance on a credit card and are paying higher interest than you should based on your credit score, switch it over to a lower-rate credit card from Arsenal and pay no balance transfer fee. Paying too much for your auto loan? We help both members and nonmembers refinance their high interest rates into lower, more affordable ones. Contact us to see how we can help you.
4. Track where your money goes
Big purchases can put a dent on your savings goals, but smaller, every day purchases can also make your savings spiral out of control. Going out to eat, ordering expensive coffee and frequent nights out can all add up over the long run. Make it a goal to track where your money goes, and to cut out unnecessary expenses.
For help with this, Arsenal offers a powerful personal budgeting tool within online banking called FinanceWorks. With FinanceWorks, you can see what categories, such as dining, entertainment and clothing, you spend the most on, and set budget goals for yourself.
5. Teach good savings habits to your kids
If you have kids who are age 12 and under and your relatives gave them cash for Christmas, make sure that money goes toward their future. A Tracker Kids Savings Club account helps teach the importance of saving while offering fun incentives, such as money for good grades, birthday cards and prizes.
For older kids, it’s never too late to instill good savings and money management lessons. Come visit a branch with them and set up a savings account and a checking account with a debit card.
6. Educate yourself
Knowledge is power. The more you read, the more financial knowledge you gain. The more financial knowledge you gain, the better decisions you make. Start a habit of seeking out financial education materials from your local library, online or from Arsenal’s financial education resources.
The internet is full of educational resources, some good and some not so good. If you see an article online that delivers information that doesn’t quite add up, question it. Use this helpful guide to help determine if the site you are viewing is legit or not. Articles posted on our site, blog and social media channels are ones you can trust.