When January rolls around, many of us resolve to shed the extra pounds and credit card balances we picked up during the holidays.
There’s also a good chance you’ve made that pledge before, only to have it end in failure. Don’t worry. Sometimes our resolutions are just too ambitious. A more measured approach could be the key to success.
Start the Year with a Financial Assessment
Use the USAA Financial Readiness Score tool.
Here are four modest and manageable steps to help you slim down in 2017:
- Start with an achievable goal. We’d all love to wipe out our borrowings and start over with a clean slate, but if you face a proverbial mountain of debt, that goal may not be realistic. Instead, start small, and add incremental goals along the way. For example, if you’re trying to pay down $10,000 in credit card debt, set a goal to eliminate 10% of the total by the end of summer. Once you reach that milestone, set a new, attainable goal and keep chipping away.
- Work both ends of the equation. “Budget” is not a four-letter word, so embrace it! One of the first things I advise people on paying down debt is to establish a realistic budget and stick to it. That works whether you’re managing calories or currency. However, cutting back isn’t the only way to achieve your goal. Increasing income through part-time work, the sharing economy or selling stuff can speed your progress. Think of it in the same way you deal with unwanted holiday pounds: A diet can help drop weight, but when combined with exercise, the fat melts away even faster.
- Don’t go it alone. Whether in weight loss or debt reduction, it helps to have someone cheering you on. Consider finding a battle buddy, so the two of you can support each other when times get tough. And don’t be afraid to call in a pro. Installation financial counselors or a counselor associated with the National Foundation for Credit Counseling (www.nfcc.org) can help put you on the right track. Let’s face it: We can get more done together.
- Reward yourself … in moderation. Reducing debt will require sacrifice, but it’s OK to occasionally treat yourself for a job well-done. But keep in mind that moderation is the key. Maybe your idea of a reward is a night on the town. If so, avoid the five-star restaurant and enjoy something at a moderate price. In fact, “moderation” is a good way to think about how to approach all spending after you pay down your debt or hit your target weight.
A commitment to bettering yourself is a great way to start the new year. Whether you’re looking at shedding pounds or debt, it makes sense to set attainable goals that help you stay with your plan for the long haul. Let’s get light!
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