Many people kick off the New Year with a laundry list of resolutions and super ambitious goals—especially when it comes to their finances. But take note, your goals can quickly feel unattainable and overwhelming especially if they’re not realistic. So, to set yourself up for success, we caught up with Tiffany “The Budgetnista” Aliche, the founder of the Live Richer Challenge. The LRC is a free, online financial challenge created to help women raise their net worth by decreasing their debt and increasing their assets in 22 days. In 2015, Aliche helped 10,000 women save $1.5 million and currently her challenge has over 500,000 women from all 50 states and over 100 countries signed up for the 2018 challenge.
When it comes to living paycheck to paycheck, increasing a poor credit score, or getting a relief from student loan debt, what’s the most overlooked step in setting a strong foundation?
It all comes down to managing your basic financial skills. The foundation is your budget, a picture of what your money is doing, and then once you figured that out you can change that picture. For instance, you can say to yourself: ‘I’ll do less here, and do more here.’ The real key to financial success is to earn more and spend less than you make—give some, save some, and invest some.
What are three things people can do to maintain their goals?
1. Write down your goals—some actionable goals that you can actually make happen—no more than three financial goals for the new year and the goals should be specific, answering the questions: what, how, when.
What: My goal is to save $2,000
How: By transferring $100 per paycheck into my savings account automatically
When: By September
2. Get yourself an accountability partner. They don’t have to be financially savvy. They have to be someone who will check in on you and you check on them about your goals. Make it someone who you want to share your goals with and will check in regularly with.
3. Automate is the new discipline. Whatever your financial goals are, try to infuse some automation. For instance, if your goal is saving, in order for you to guarantee what to save, break down $2,000 divided by 10 months, that’s $200 a month divided by two checks a month, that’s $100 a paycheck and then automate $100 a paycheck. So try to infuse automation.