Like may people, I am using the new year as a great time to re-look at our finances. Here are a couple of things that I have decided to focus on so that we will have a bigger saving account by the end of the year:
1. Establish an emergency savings account that is equal to 3 months of our monthly expenses. We need to have savings to cover ourselves when all of those "little" emergencies that come up. I don't sub in the summer and my hubby's hours always get cut, so we end up in a bind each year. In order to do this, we will set aside a consistent amount each paycheck.
2. Clean-up our debt. We are lucky enough not to have too much in credit card debt - we have under $3,000, but we have a lot of medical bills that we need to take care of. All US residents have the right to a free credit report each year, so I will be ordering one for my husband and I today from this free annual credit report site. Because you are allowed one report per bureau each year, some experts advise staggering requests (ie. requesting one from TransUnion this month, one from Equifax in May, and one from TRW in September. This will allow you to order three credit reports per year, and provide you a way to monitor your credit throughout the year. We will set aside an amount to pay towards debt reduction each month - as we pay off a debt, that amount will be added to the debt reduction amount as well. If we are able to build up our 3 month reserve, that amount will also go towards debt reduction.
Do you have any New Year's Resolutions regarding your fnances?