Dec 22, 2022

The holidays provide some “down time” for most people. As you get a chance to catch your breath from a busy schedule, take some time to think ahead about your personal finances for the coming year.

A few simple steps can make a significant impact. Here are three easy things you can do to start off on the right foot in the new year.

1. Refinance high-interest debt

A quick way to put more money back in your pocket every month is by refinancing high-interest debt like your credit cards. At this time of year, many credit cards offer 0% balance transfer promotions so you pay no interest on the amount you add. However – these offers typically have a time limit (usually 12 months) so be prepared to pay off the transfer amount within that time frame…otherwise you’ll end up paying the interest anyway and forfeiting the savings from the offer. Another opportunity may be to refinance your auto loan. If you’ve improved your credit score this year, you may qualify for a better rate – which can mean lower monthly payments. Or, you could shorten the term of the loan so you own your car or truck quicker. With either option, the goal is to pay less in interest charges and keep more money in your wallet.

2. Check your credit score regularly

Speaking of credit scores – yours is important because it helps determine how much you can borrow, what your interest rate will be, and what lending options you may have. You can improve your credit score by making on-time payments, being careful about taking on additional debt, and be prompt in disputing any errors on your credit score. There are many online services that monitor credit scores. Cinfed members can check their credit score any time they want when they register for My Credit Score, available through Cinfed Digital Banking. With this free service, members can set up alerts to be notified whenever there’s a change on their credit report – so any errors or discrepancies can be addressed immediately. While a strong credit score is built over months and years, you can see small increases in just a few weeks by doing the right things – and regularly monitoring your score is the first step.

3. Make savings automatic

Every time you make a deposit, devote a percentage to a designated savings account. If you have direct deposit, it’s easy to set up an automatic transfer so that a set amount gets delivered into your savings each time. Once the money is in the savings account, leave it alone unless you have an emergency or unexpected expense. As time goes by, the balance will grow and provide you with financial flexibility so you have the freedom to make more choices, such as the ability to make purchases without loans, or to make investments that grow your money even more. The most important part is having a savings mindset: remember that financial growth will take time and each deposit is another step toward a better financial future.

The new year is a great time to review your personal finances and make sure you’re on track. These three steps are an easy way to get started. To get into detail about your finances, contact a Cinfed branch location and talk with a Financial Coach.