The start of a new year is the perfect time to take control of your finances and set the tone for a successful 12 months ahead. Whether you're planning to save more, spend smarter, or tackle debt, a little preparation now can pay off in a big way later. Here's Skyward Financial’s guide on how to get started:

1. Reflect on Your Financial Wins and Challenges

Take a moment to review the past year. What did you do well? Maybe you saved for a big purchase or stuck to your grocery budget. On the flip side, where did you fall short? Reflecting on your financial habits will help you understand what to adjust moving forward.

Pro Tip: Write down three financial goals you’re proud of achieving last year and three areas for improvement, share them with us over on instagram @skywardfinancial 

2. Set Clear Financial Goals

Having specific, measurable goals can keep you motivated throughout the year. Whether it’s saving for a down payment, paying off a credit card, or building an emergency fund, write your goals down and break them into actionable steps.

Example Goals:

• Save $5,000 for a vacation by December (that’s about $416 per month).
• Pay off $2,400 in credit card debt (or $200 per month).

3. Create or Revise Your Budget

Your budget is your financial roadmap. If you’ve never created one, now’s the time to start! If you already have one, revisit it to ensure it aligns with your current goals and expenses. Factor in changes like a potential salary increase, rising costs, or new priorities.

Budget Tip: Use the 50/30/20 rule: 50% for needs, 30% for wants, and 20% for savings or debt repayment. We have an amazing, intuitive, and detailed budgeting spreadsheet you can access for free by signing up for our newsletter at skywardfinancial.org.

4. Automate Your Savings

Make saving effortless by setting up automatic transfers to a high-interest savings account or TFSA. Automating your savings ensures you’re consistently putting money aside without having to think about it. Even small amounts add up over time. This is something that Skyward Financial can help you with, book a free call online!

5. Review Your Subscriptions and Spending

The new year is a great time to audit your recurring expenses. Are you paying for services you no longer use? Cancel unnecessary subscriptions and redirect that money toward your financial goals.

Challenge Yourself: Try a no-spend month in January to reset your habits and identify unnecessary expenses.

6. Check Your Credit Report and Score

Your credit score plays a crucial role in your financial health. Obtain a free credit report from a service like Credit Karma or Equifax to ensure there are no errors and to see where you stand. A strong credit score can save you money on loans and help you secure better interest rates.

7. Build or Reassess Your Emergency Fund

If the past few years have taught us anything, it’s the importance of being prepared for the unexpected. Aim to have at least three to six months' worth of living expenses saved. If you’ve dipped into your emergency fund, make a plan to replenish it.

8. Plan for Taxes Early

Tax season may feel far away, but preparing now can save you stress later. Gather receipts, review your income, and consider setting aside funds if you expect to owe taxes. Don’t forget to claim deductions and credits you’re eligible for, such as RRSP contributions or childcare expenses. Max out your TFSA and RRSP contributions for 2024 as well! Need support? Book a call with us to get help. 

9. Revisit Your Investments

Take some time to review your investment portfolio. Are your investments aligned with your long-term goals? Consider consulting with a financial advisor to ensure you’re on track.

Investing Reminder: Even small, consistent contributions to your RRSP or TFSA can lead to significant growth over time thanks to compound interest.

10. Protect Your Finances

Ensure you’re covered with adequate insurance. Life, health, and home insurance policies are crucial for protecting you and your loved ones from unexpected financial burdens. Revisit your policies to confirm they meet your needs.

11. Start a Financial Accountability System

Share your goals with a trusted friend or family member who can help keep you on track. Alternatively, join a financial literacy group or use budgeting apps to stay motivated and organized.

Preparing your finances for the new year doesn’t have to be overwhelming. By taking these steps, you’re setting yourself up for a year of financial success and peace of mind. Remember, small, consistent efforts can lead to big changes. Here’s to a prosperous year ahead with Skyward Financial!

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