STATE — The New Year is fast approaching. With its promise of starting fresh, The Provident Bank suggests committing to financial resolutions this year! But rather than setting vague financial goals, such as “get rid of debt” and “stick to a budget,” the bank recommends making a list of specific, measurable resolutions to whip your finances into shape.
“The start of the New Year puts us in the mindset to reorganize, plan and reprioritize by setting new goals. It’s a great opportunity to review your finances and make adjustments for the future,” said Chris Martin, president and CEO of The Provident Bank.
Here are seven financial resolutions to help set yourself up for success in 2012:
1. Pay yourself first
According to the Department of Commerce, consumers sharply reduced their savings this year. The savings rate is near its lowest level since the beginning of the recession. In 2012, commit to saving more! To make it easier, consider authorizing a direct deposit monthly from your checking account into your savings account to stick to this financial resolution.
2. Don’t pay for checking
Despite reports that the days of free checking are waning, there are plenty of banks that still offer checking accounts at no-cost. Consumers may need to shop more carefully! There also are other ways to avoid monthly charges: sign up for direct deposit, bank online and use debit cards more often.
3. Review your investments
Is it time to rebalance your investment portfolio in light of changing market conditions or your changing needs? If you haven’t made a habit of doing so, make sure to review all of your account statements carefully. You should also consider meeting your financial advisor to review your investments from this year to see if they’re on track with your short- and long-term financial goals.
4. Sharpen your retirement plan
This advice applies to people of all ages! Rather than hope you’ll have enough for a comfortable retirement, take the time to calculate how much you’ll actually need. If your employer offers a retirement plan, take advantage by contributing enough to get the maximum company match (if there is one). You can also open an IRA with your local bank.
5. Prepare for a financial emergency
Another reason to contribute consistently to your savings account! Having savings helps you avoid putting emergency expenses from a sudden loss of income on your credit card and having to pay the interest charges. A reasonable goal: save six months to a year’s worth of expenses.
6. Close unnecessary accounts
Not using a bank account? Consider closing it to avoid having to reactivate the account and the potential costs attached. Haven’t used a credit card in a while? You may want to cancel it once the balance is paid, especially if it has a high annual fee. Your credit score is based on the length of your credit history, so you should keep your longest-standing account open and consider closing others.
7. Preserve your assets
Failing to plan could cost your family and loved ones. A sound estate plan can help preserve your assets and keep them from being unnecessarily burdened with taxes and uncertainty about the future. If you’re not sure where to begin or what questions to ask, consider talking to your banker.
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