Many New Years’ resolutions center around physical health, mental health, even the health of our relationships, but what about your financial health? Have you made any resolutions or goals to improve your financial well-being this year?

With the average American owing over $90,000 in debt, you may find yourself eager to tackle your debt this year. But where should you start? Here are a few simple tips to get you started on your journey towards reducing your debt and improving your financial health in 2022.

Identify Your “Why”

It’s easy to say you want to reduce your debt, but the actual process can be long and difficult. Solidifying why you want to address your debt will be one of the best tools in your journey. Your “why” will help you make tough decisions when it comes to planning, prioritizing, sacrificing, and spending your money.
To help you get at the heart of your “why,” here are some questions to consider:

  • Why is reducing my debt important to me (and my family)?
  • What will it feel like to reduce my debt?
  • How will this change my (family’s) life?

Face the Facts

Once you know why you want to reduce your debt, it’s time to face the numbers. Accessing your credit report is a great way to find the starting point for your debt reduction journey, and it’s free! Anyone can access their credit reports from any of the three major credit reporting agencies (TransUnion, Equifax, Experian) by visiting www.annualcreditreport.com. While your score is not included in your free credit report, you can learn important information about your credit history and debt. Plus, it’s a great way to check for fraud or other signs of identity theft.

Make a Plan

When you fully understand your debt as it stands today, the next step is to make a plan. Start with setting a SMART goal; these goals are Specific, Measurable, Attainable, Relevant, and Timebound. The process of setting a SMART goal will help you precisely identify what you want to achieve. For example, my goal of reading more books this year becomes “I plan to read 15 books by June 30” as a SMART goal. Follow up your SMART goal with three action steps that will help you achieve that goal and timelines to help you monitor your progress.

Find a Buddy

Social influence can be a powerful asset for anyone looking to make a change, so it’s important to find someone you trust to assist you on this journey. This may be a spouse, friend, church member, or a trained Financial Coach at Metrocrest Services! Schedule time to meet with this person on an ongoing basis to help hold you accountable for the goals and action steps you have set. This person can serve as an active listener when the journey is hard and someone to help you celebrate when the goal is accomplished.

Our trained Financial Coaches are ready and eager to assist as you set to make 2022 the year of greater financial health for you and your family. Please call 972-446-2100 to schedule your financial coaching appointment today!

Financial Empowerment Manager, Victoria Mendoza

About the Author

Victoria Mendoza is the Manager of Financial Empowerment at Metrocrest Services. She is an Accredited Financial Counselor® with a passion for helping people improve their financial well-being.