Setting financial goals for 2022 is something I’ve been thinking about for the past few weeks. I had a pretty good year financially in 2022 and I want to continue with that during 2023.
Why Saving For Tomorrow Is More Important Than You Think
The future is unpredictable, with Covid, Brexit and an increase in prices we can feel a bit uncertain about our financial security. We are always faced with challenges that are hard to overcome and it is natural for us to want to do something about it. We want to be able to do something about the things that will affect our future, whether it is now or later on in life. Saving money can be a great way to prepare for the future.
Some people find it overwhelming and confusing, so they never even think about saving money. Others have tried saving money before, but they failed because of a lack of discipline or knowledge on how financial markets work. To help you out, I’ll provide an introduction to the importance of saving money for your future needs and why you should do it now instead of tomorrow.
Why Saving for The Future Matters So Much
Most people know that they should be saving for the future, but they don’t do it. This is not because they are stupid, but because they are unable to.
There are three main reasons why saving for the future is so important. Firstly, living in today’s world means that it is likely that someone will be made redundant, become sick or have an accident at some point during their lifetime. Secondly, most people can’t afford to live on what they earn alone and if anything happens to them, their family could quickly fall into poverty. The third reason being that saving helps you build wealth which provides security and helps your financial situation improve over time.
How To Save Money For The Future Easily & Quickly
Every single person needs to manage their personal finances and budget their expenses. This is the first step of becoming financially independent and controlling your money.
Step 1
Step 2
Next, list your variable expenses such as eating out or going on holiday. A variable expense can be anything that varies from month to month but does not need to be paid every month.
Step 3
After this step, create a list of monthly goals or savings goals that you want to accomplish in the next year with an average amount of money needed for each goal.
Step 4
Lastly, make a detailed list of ways you can save money each day – from simple things such as spending less money on takeaways to larger things like downgrading a car or phone contract.
Step 5
Be realistic and don’t forget to leave yourself with enough money to still enjoy your life!
Achieve Your Finacial Goals in 2023
My 2023 Finacial goals
My saving goals are all aimed at buying a bigger house in a few years. We want our forever home. We currently have a nice house, but it’s smaller than we would like and in an expensive area. The goal is to get a bigger home and be able to put more money into it so we can reduce the mortgage payment amount to put us in a good financial position.
After that, the goal will be to be mortgage-free as soon as possible so will continue to overpay the mortgage.
Earn at least £2000 a month
I left my job after maternity to blog full time and it’s been going great for me! I’ve managed to earn some good money. Even though I only wanted to earn between £600-£1000 a month, I’ve managed to smash that every month. I want to earn over £2k consistently in 2022.
Continue using sinking funds to budget
I’ve been using Monzo pots to save money for things I’ll need in the future. I’ve got a pot for my car insurance, one for my wedding, one for dental work, one for tax and one for a new laptop. I even have pots for birthdays and Christmas.
I’ve found using pots really helps me save for these future expenses and once the money is in the pot, I forget about it. Then when the time comes to insure my car, I am not worrying about finding extra monthly that month.
I’ve currently got about £1500 in all my pots for various things for the next 12 months which is a massive load of my mind. Just having it in my Monzo account inside pots rather than my current account means I can’t easily spend it!
I do find that sometimes I do need to use my pots, so I can carry things over. Like I still have a bit of money in my ‘Christmas pot’ which will make next Christmas a bit easier for me. It means I don’t need to use credit cards. It’s almost like an emergency fund, but the money has already been allocated for its use.
I don’t really want much more than this in this type of savings as there’s no interest on it so it devalues over time.
Save £5000 on premium bonds
I want to increase my savings by £5000 this year. This goes into premium bonds. We hope to move house in 2.5 years so this money will be used either towards our new house or on renovations.
This means I need to save about £420 a month. If I hit my earnings goal, I can do this, otherwise, I’ll have to go back to working on some side hustles.
Pay £5000 extra onto my mortgage
I love making mortgage overpayments! I always aim to save the same amount as I overpay the mortgage now. So again, this will be £420 a month.
What are your financial goals for 2023?
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