2017 Money Resolutions: Small Steps Now for Big Gains Later

Most of us don’t stick toour New Year’s resolutions, often because they’re too ambitious: Lose 20 pounds! Go to the gym every day! Finally get a handle on money!

Our enthusiasm runs out long before the rewards roll in. But what if you could get some early momentum, then use those gains to fuel your resolve for the rest of the year?

If fixing your finances is among your resolutions for 2017, try thesesimple, do-it-now strategiesthat can accelerate your progress toward personal finance victories throughout the year.

Set a budget

Does the thought of creating a budgetfeel as daunting as climbing Everest? Knock off small, strategic stepsfirst, then let them build toward an overall smart spending plan.

Do it now: Look over your 2016credit card bills; some card issuers even provide a year-end statement grouping expenses by category. Call your credit card company to find out. Once you know the details of your credit card spending, cancel recurring payments for things you don’t use, like magazines that just pile up or streaming services you rarely watch. Endauto-renewals on services you didn’t intend to sign up for or don’t need.

Long-term goal: Sign up for a budgeting tool and use it to get a picture of your spending patterns. Use that information to try out the simple 50/30/20 budget.

Fill an emergency fund

Saving for emergencies comes before trimming debt or building credit. Why? Without a cushion, any unexpected expense can quickly lead to spiraling debt and bigger credit card balances. Ideally, you want your emergency savings to equal three months of living expenses. But if that seems impossible,as little as a few hundred dollars can keep you out of a debt spiral.

Do it now: Funnel the savings from your credit card and expenses review (see budgeting tip above) into your emergency fund. File your taxes ASAP, and use part or all of your refund to make quick progress.

Long-term goal: Want to beef up your fund and your credit score at the same time? A credit-builder loan can provide that two-for-one benefit. These loans are easier to get than traditional loans, because you pay off the amount first, then the cash is released to you. Add that cash to bring your emergency fund up to the level you want.

Build credit

Good credit makes life easier: You can securelower interest rates when you borrow, it may lower your car insurance rate, and you look better to potential landlords.

Do it now: Sign up for a free credit score, such as the one offered by NerdWallet, that also offers credit report information. Next, set up automated reminders for bill due dates and alerts if your balance is approaching 30% of the limit on any one card.

Meet your long-term goal: Dispute any errors you see on your credit report; getting inaccurate negative information removed can boost your credit. Monitor your report throughout the year.

Stay on top of due dates and balances with thosealerts. Paying on time and keeping your credit utilization low are the two biggest influences on your credit score.

Reduce debt

This is abiggie, and it defeats many people every year. The key: Doing something — anything — is better than avoiding your debt. Even baby steps will build a habit that helps in the long run.

Do it now: Get a handle on your debt by making a list ofeverythingyou owe, notingpayment amounts and interest rates. Read about debt-payoff methods and choose the one that fits your personality.

Long-term goal: If your debt list revealed a lotof high-interest debt,calculate how many years until you pay it all off. (You can use thecalculatorin this story.) Once you have the timeline, considerconsolidating your debts into a personal loan — but only if the loan gives you a lower rate or accelerates your payoff schedule.

If you don’t qualify for a loan because of your credit profile, don’t despair. Just continue your credit-building activities and try again in a few months.

If reality hits and you determineyou’re unable to pay off your debts within the next five years, we suggest talking to a credit counselororbankruptcy attorney.

Plan for retirement

Are you also in full avoidance mode when it comes to your retirement? Make this the year you face it head on and with commitment. You’ve heard it before, and it’s true:Theearlier you start the more impact your contributionshave. Do more now so you can enjoy more later.

Do it now: Bump up your 401(k) contribution by 1% or more. Your employer or the 401(k) company’s website should make this easy. If you’re not enrolled, enroll now. They’ll make this easy, too.

Long-term goal: If you don’t have access to a 401(k), open an IRA. It requires a little more effort than increasing acontribution to aworkplaceplan, but it’s still manageable — and highly beneficial.Another long-term step that’s key to retirement savings: Make it a habit to divert half of any raise orbonus you receive into your 401(k) or IRA.

The article 2017 Money Resolutions: Small Steps Now for Big Gains Later originally appeared on NerdWallet.