According to Pew Research, 44% of people believe the financial impact of the COVID-19 pandemic is long-lasting. They believe it'll take them three years to recover to pre-pandemic financial situations. Whether you're in that group or don't think the pandemic hit you financially, making financial resolutions for the new year can be a positive practice. They help you choose some money and credit goals to focus on and let you work toward recovery, savings, or growth in realistic ways.
Start a savings resolution today by making a goal and breaking it up into smaller, realistic amounts. Want to save $3,000 this year? That's only $250 a month or around $63 per week.
Consider automating deposits into your savings account to make it more likely you'll succeed in your financial resolution. You could have $100 of every biweekly paycheck deposited to your savings account, leading to $2,600 in savings by the end of the year.
If you’re looking for a brand new mobile financial app, why not give Chime a go? Chime has a lot of neat features, including a clever automatic savings tool and a competitive 0.50% Annual Percentage Yield1—8x2 the national average!
>> Read our full Chime Review.
Your payment history makes up 35% of your credit score. If you don’t pay your bills on time, your financial outlook can suffer. Make a resolution to avoid late payments this year. If you’re busy or somewhat forgetful, here are some tips to help you stay on schedule:
Enjoy doing your taxes? No, neither do we. But there are some potential benefits to filing early. If you file your taxes before the rush that occurs late in the season, you could get a faster refund. You’ll also reduce the chance of identity theft, avoid penalties, and—if applicable—give yourself extra time to save for your tax bill.
The more account types you have in good standing on your credit report, the more likely you are to get approved when you go for a low-interest car loan, personal loan, or mortgage. Lenders scrutinize your credit report—and they look for a good mix of account types.
Revolving accounts include credit cards, store cards, and home equity lines of credit (HELOCs). Installment accounts are products like personal loans and car loans, which have fixed monthly payments. Open accounts, like charge cards and utility accounts, require payment in full each month. Your credit mix accounts for 10% of your credit score.
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Just make sure you aren’t opening new accounts that you can’t afford. Remember, on-time payments are more important than account mix so make that your priority.
Tip: Do you rent or pay utilities? Consider signing up for ExtraCredit to get those accounts listed as new tradelines on your credit report!
Credit utilization ratio is the amount of credit you have available versus how much you’re using. If you regularly max out your credit card, your score can go down. Try to avoid using more than 30% of your available credit at any time. If you have a card with a $1,000 credit limit, for example, stop spending when you reach the $300 mark until you can pay down some of the balance.
Your credit utilization rate accounts for 30% of your credit score. If you need to use more credit, try asking for a limit increase to avoid messing up your ratio.
Budgeting helps you create a foundation for meeting your other New Year's financial resolutions. Learn how to create a budget that's realistic and that you can stick to every month. You might also want to sign up for financial tools that help you keep a good eye on your money and save on common fees. For example, Digit analyzes your spending habits and determines what will help you meet your savings goals, and Chime offers an online and mobile account that helps you gain faster access to direct deposits and save automatically, letting you do more within your budget.
There's never a bad time to build wealth for the future, and you don't need to be a high roller to start investing. If you've never invested before and want to make this one of your New Year's financial resolutions, you might consider trying the Acorns app.
You can start investing using Acorns with as little as $5. You can also sign up for a debit card with Acorns that lets you invest change when you shop. Acorns rounds up every purchase and deposits your change into your investment accounts.
If you want to end the year with less debt than you started with, this is a great financial resolution to make. Make a plan to pay down debt:
If you're looking to make a career move to help you recover from financial stressors associated with COVID-19, or you simply want to earn more or have a more stable job for the future, getting a new job is another top financial resolution for any year. Get some information on steps for finding a new job, and use resources like ZipRecruiter or Monster to help you connect with employers that are seeking people with your skills.
Want to know a bit more about where your credit stands before you start making big resolutions and plans? Sign up for Credit.com's free Credit Report Card. It provides a grade for you for each of the five major credit scoring factors. You can use those grades to target your financial resolutions to areas of credit or money management where you may need some additional work.
Chime is a financial technology company, not a bank. Banking services provided by The Bancorp Bank or Stride Bank, N.A.; Members FDIC
1The Annual Percentage Yield (“APY”) for the Chime Savings Account is variable and may change at any time. The disclosed APY is effective as of December 1, 2021. No minimum balance required. Must have $0.01 in savings to earn interest. Chime Checking Account is required to be eligible for a Savings Account. Banking services provided by The Bancorp Bank or Stride Bank, N.A.; Members FDIC.
2 The average national savings account interest rate of 0.06% is determined by FDIC as of November 15, 2021 based on a simple average of rates paid (uses annual percentage yield) by all insured depository institutions and branches for which data are available. Visit https://www.fdic.gov/regulations/resources/rates/ to learn more.