Some people start the new year by making resolutions concerning their finances. When individuals decide which areas, they want to experience a change in, they can set clear financial goals. Individuals may consider making changes in the following areas to improve their finances.

Contribute More to Retirement Accounts

Employees should consider increasing their retirement savings on their jobs if they can afford to save additional money. Contributions in a retirement account give employees the same tax savings as a Roth IRA. If employees cannot increase retirement savings due to personal obligations, they can review the retirement plans to see if it is possible to increase their contributions in the future. There are retirement plans that allow employees to save more for their retirement accounts later.

Have an Emergency Fund

Create an emergency fund. Only 72% of Americans have an emergency fund. It’s recommended that individuals have an emergency fund that can pay for six months of their living expenses. The money should be held in an account that they can access when necessary. This money should not be in a high-risk account because it is reserved for necessities and to cover costs for unexpected expenses. Some individuals also have an emergency food pantry.

Invest Money

Individuals can increase their investments. Consider investing money outside of employer retirement accounts and IRAs. If there are goals that are time-sensitive, investment income can be used to achieve these goals. Individuals should determine how much they feel comfortable risking in the market and diversify their investments across various asset classes that reflect the market’s performance and what they desire to achieve.

Review Spending Habits

Individuals can review their spending habits and identify where they spend money. By reviewing spending habits, a person can get a clear picture of where their money is going and make changes wherever they are necessary. Individuals can review their purchases from the previous quarter to determine where they have spent their money and document their monthly payments. This can give someone an idea of how they can create a realistic budget.

Individuals can determine which strategies can assist their households by improving their situation. By developing money management skills, individuals can create a successful financial future they desire for their families.