Tips For Starting The New Year Off On The Right Financial Foot

This past year has been full of surprises for us all, and let’s be real – many of them were unpleasant. Thanks to COVID-19, many people have found themselves in a tough spot financially for months. Although the first stimulus package alleviated some of the hardships, as the pandemic has drawn on, it simply isn’t enough for those who still find themselves without a job.

With this economic backdrop in mind, it’s no wonder people are worried about their finances. At AutoMax, we’re always doing our part to try to bring a little peace of mind to our customers. Below, we share some ideas to help you plan for 2021 so you can navigate the uncertain times we’ll likely still be facing well into the new year.

Budget Planning 101

The first thing you need to do is put together a realistic budget to plan your spending. To construct a budget, a good place to start is to review bank and credit card statements so you can see where your money has gone in the past year. You should compile a list of all regular income sources and recurring regular expenses. The good news about the age we live in is there are plenty of free apps and budgeting tools available to help with this. Once you have an idea of where your money is going, you can make more meaningful decisions about where to make spending cuts.

Once you have a budget set up, you should review your expenditures each month to gauge how well you’re sticking to it. This can identify problem areas in your budgeting and allow you to make adjustments to your spending as needed. Remember, budgets don’t have to be set in stone!

Set Up Your Savings

Another thing everyone should do is set up both short- and long-term savings. Many financial experts suggest using a 50/30/20 budgeting plan, which means 50% of your income goes to expenses that are needed, 30% of your income goes to wants, and 20% goes to combined savings efforts. Savings can include things such as savings accounts and/or other long-term investment accounts, such as retirement accounts.

Review Your Debt

If the economic strains from the past year have put you into a situation where you find yourself with a lot of debt, then you should include debt repayment and reduction as part of budget planning.

One thing to consider is to restructure some of your current debt with debt that requires lower monthly payments. This can include refinancing your mortgage, consolidating student loan debt, and re-evaluating your current monthly car payment.

If you want to reduce your car payment to make your dollars go a bit further, then you’re in luck.  AutoMax, North Carolina’s premier buy here pay here dealership, is here to help you get a reliable car for just $89. Even if the economic strains of the year have left you with a less-than-optimal credit score, we’ll work with you to help you make a car buying decision that’s financially smart. We offer top-quality vehicles, and for a limited time, you can take advantage of Tax Max, our seasonal deferred payment program.

Cut Your Spending

You’d be surprised at how many small ways you can eliminate extra spending. With a little will power, those small cuts add up to big savings. Ditch the drive-thru food and start making more meals at home. You’ll cover two new year’s resolutions at once by saving money and getting healthier. Or, even better, buy in bulk and meal plan for the entire month. Just be sure to put perishable items in the freezer so they don’t go to waste. You can also eliminate things like expensive coffee runs (bye bye, Starbucks) and eating out during lunch breaks. Again, all of these are small changes that require minimal effort, but that can make a huge difference to your long-term financial freedom.

Paving The Way For Better Finances In The New Year

Let us help you get on the road to financial recovery in 2021. By saving on car payments, you can put that money elsewhere and pay off your debts faster, or fund your savings accounts more quickly. Regardless of what you plan to use the extra cash for, you can rest easy knowing you have a reliable vehicle that’ll serve you well for the new year and beyond. Shop our online inventory or come see us at our Henderson, NC dealership or our Youngsville, NC dealership.