6 Ways to Feel More Financially Prepared in the New Year

For example, if you check your credit score and it’s lower than you’d like, you have a few months to lower your credit utilization ratio and continue making on-time payments so you can improve your score and get a better interest rate before you apply. for that mortgage or credit card.

Also consider using a tool like *Experian Boost®, which is designed to help consumers improve their credit scores by including positive payment records for certain utilities, subscription services (ie Netflix) and rentals on their credit reports. According to Experian, 66% of Experian Boost users saw their scores increase, an average of 13 points on the FICO® Score 8, the score most commonly used by lenders.

Or maybe you think it’s possible to pay for next semester’s tuition if you save a certain amount each month; planning ahead will help you figure out exactly how much money you need to set aside each month. It’s better to have a strategy than to wait until the last minute and make a financial decision that could turn out to be a costly mistake.

In other words, you may have eight months next year to plan how you’ll start making payments again if your balance isn’t wiped out by the Administration’s debt settlement program. Of course, many individuals don’t want to make payments right now, despite the interest freeze, because they could save a significant amount of cash if their balance runs out.

One of the best ways to prepare is to start saving for your monthly payments. So if your monthly payments are $300, you should put that $300 into a savings account each month. That way, you’ll still have money to make one large loan payment when the moratorium is lifted. And if your debt is eventually wiped out, you’ll have a lump sum of cash that you can use for another financial goal of yours, such as buying a home or investing for retirement.

One way to pay off debt is to use a balance transfer card, which allows you to transfer debt from a high-interest credit card to a new card that offers no interest for an introductory period. This will help you pay off your balance a little faster because you’ll save on interest charges. The Wells Fargo Reflect® Card, for example, has a 0% introductory APR for up to 21 months on balance transfers and new purchases (17.24% – 29.24% variable APR after, balance transfers must be made within 120 days of account opening) : .

You can use a service like Zoe Financial to search for nearby financial planners who specialize in the areas you need the most help with. Your first consultation call is usually free, so you can talk to a CFP to find out if they’re right for you and if they’re someone you’ll have a good experience working with.

While 2022 was a financially tumultuous year with many twists and turns, there are steps each individual can take to go into 2023 feeling a little more prepared. Building an emergency fund and making plans to make big purchases and pay off debt are some of the most important things you can do as you end the year. But don’t forget to always seek professional help for personalized recommendations.