Top 9 Financial Resolutions for the New Year (2023)

Top 9 Financial Resolutions for the New Year (2023)

New Year New Me with resolutions written on a notepad on a coffee table with a laptop, pencil, and plant.With each new year comes the perfect opportunity to reflect on the progress of your financial life and create actionable goals for the 12 months ahead. While most people focus on saving more money and paying down debt, others place importance on shifting behaviors around money management and increasing their income in an attempt to improve one’s financial circumstances.

Millions of Americans will create a New Year’s resolution in 2023, but only a fraction of them will succeed in achieving their goals. It’s discouraging to resort to half-measures or outright failure for weeks or months at a time, prompting most people to abandon their resolution altogether.

One solution is to set attainable financial goals that take small steps in the right direction rather than unlikely giant leaps. If you’re planning to make the new year your best one yet, check out our top financial New Year’s resolutions to get you started with a bang.

Top 9 Financial New Year’s Resolutions

1. Boost Your Credit Score

One of the most powerful financial moves you can make in the new year is checking your credit history reports and improving your scores. You can view your reports for free with the three major credit bureaus, Equifax, Experian, and TransUnion, once every 12 months through AnnualCreditReport.com.

Checking your credit reports and credit scores gives you the information you need to make changes, if necessary, and identify any errors that need to be corrected. With a clean credit report and good credit score, you will have access to more affordable credit now and in the future.

This can save you hundreds to thousands of dollars if you are thinking about taking on some form of financing in the new year.

2. Evaluate Your Debt

Another smart resolution for the upcoming year is taking a close look at your current debt. Having consumer debt, including credit card balances, personal loans, student loans, or a mortgage isn’t necessarily a bad thing. However, interest accruals on these debt balances can add up to a significant amount over time. You could also be potentially hurting your credit score.

Look at what you owe and the interest rate on each debt, then determine what might be available for extra payments. When paying extra is not a feasible option to reduce your debt load, consider alternatives such as a debt consolidation loan or debt relief program for additional assistance.

3. Work on Your Budget

Another important financial resolution that will add money to your wallet is committing to working on your budget. Figuring out what money is coming in and where it’s going every month can be an enlightening process.

If you’re noticing that you don’t have as much as you’d like to set aside for retirement, investments, or savings, looking at your budget can reveal where you may be able to cut back or reallocate some of your spending.

Budgeting doesn’t have to be difficult, though. There are a handful of money management apps, websites, and desktop software programs to make the process a breeze.

4. Increase Your Savings Amount

To continue reading, please go to the original article here:

https://www.aprfinder.com/financial-resolutions?fbclid=IwAR0NZJYKkjEHalFQl0gV-t-U2oRQvvqX3RWAi38ZRAfRfDwdOUq6U7Uc4hs 

Why Is Inflation So High? Plus How Your Wallet Can Survive

Why Is Inflation So High? Plus How Your Wallet Can Survive

December 21, 2022 by Josh Dudick

In the past few months, Americans have seen a sharp increase in the price of many essential goods and services. With salaries staying the same, this inflationary trend has frustrated many people, leaving them concerned about the future.  The latest consumer price index (CPI) reports a 7.7% increase in inflation over the last year (a 40-year high). This inflation data shows that the average American family spends more each month to cover basic living expenses.

Which begs the question – why is inflation so high?

While there is no single factor that can fully explain this trend, there are a few key drivers that have contributed. Here are some of the culprits.

Too Much Money in The System

The COVID-19 pandemic necessitated a prolonged lockdown, keeping people inside their homes and businesses closed. While this helped curb the spread of the virus, it led to an overabundance of funds in the system.

People spent less, but cash was in surplus, driving inflation. America’s economic stimulus package was an additional influx of funds into the economy, further contributing to inflation. According to the Federal Reserve, Americans had extra savings of $2.3 trillion from 2020 to mid-2021 – that’s a lot.

All these got reinforced by shortages of everything from food to other household items, so people had less to buy. In the end, people started spending on whatever was left and, by so doing, bumping up the prices of these items.

Supply and Demand Imbalances

When there is more demand for a good than available supply, the price goes up. People are willing to pay more for goods when they are insufficient, racking up inflation figures.

At the height of the pandemic, when spending dropped and savings increased, the demand for goods and services decreased. But now that we have emerged from this crisis, people are more willing to spend, increasing demand.

To continue reading, please go to the original article here:

https://investedwallet.com/why-is-inflation-so-high-plus-how-your-wallet-can-survive/ 

Ancient Rivers of Money

Ancient Rivers of Money

By Venkatesh Rao

This entry is part 1 of 14 in the series Psychohistory

Sometimes a single phrase will pop into my head and illuminate a murky idea for me. This happened a few days ago. The phrase was “ancient rivers of money” and suddenly it helped me understand the idea of inertia as it applies to business in a deeper way. Inertia in business comes from predictable cash flows. That’s not a particularly original thought, but you get to new insights once you start thinking about the age of a cash flow.  We think of cash-flow as a very present-moment kind of idea. It is money going in and out right now. But actually, major cash flow patterns are the oldest part of any business.

It is the very stability of the cash flow that allows a business to form around it. In fact, most cash flows are older than the businesses that grow around them. They emerge from older cash flows.

When you buy a sandwich at Subway, the few dollars that change hands are part of a very ancient river of money indeed. Through countless small and large course changes, the same river of money that once allowed some ancient Egyptian to buy some bread from his neighbor now allows you to buy a sandwich.

Buyers and sellers alike see markets as an illegible and turbulent churn of transaction opportunities. But really, they are landscapes carved out by great, ancient rivers of money and their tributaries. These rivers change course rarely. Cash flows are also among the most basic financial ideas. Only businesses make profits, but governments and non-profits form around cash flows too.

These ancient rivers carve out both a spatial and temporal landscape. Spatially, the flow metaphor suggests old, dried-up river beds, gorges and ravines, flood plains, ox-bow lakes, watersheds, and of course, the rivers themselves. This plays well with the idea of “segment.”

But markets also have a temporal dimension, based on which river of money you are talking about, and how long ago it last changed course.

If you think of markets that way, things look very different. Some rivers of money are very old and very stable. You can at most fight to displace others from prime positions along the banks. Others are new and unstable and may change course frequently, creating and destroying fortunes through their vagaries. Others may be maturing, with dams being built to stabilize them. People have always bought food and clothes. They are only now beginning to buy iPads. They are starting to not buy CDs.

Generalizing, you can even think of an average “age” of the market as a whole.  An interesting question to ask is whether early adopters as a group should be considered as living in a future market, or whether the mainstream should be thought of as living in the past. I prefer the latter model.

Organizations are like riverbank communities.

To continue reading, please go to the original article here:

https://www.ribbonfarm.com/2010/11/05/ancient-rivers-of-money/

Inflation 2023: How To Prepare Before It’s Too Late

Inflation 2023: How To Prepare Before It’s Too Late

Casey Bond   Monday, December 26, 2022

Inflation has been one of the most pressing money issues plaguing the globe this year. In the U.S., inflation was 7.7% for the 12 months ended October 2022. It’s put a major strain on household finances, and Americans are wondering if relief is in sight.

“Generally speaking, the health of the U.S. economy is strong, but is undergoing a transition from pandemic conditions to post-pandemic conditions,” said Keith Sultemeier, president and CEO at Kinecta Federal Credit Union.

That transition probably won’t happen quickly, however, and while inflation will eventually slow, we can likely expect higher-than-usual levels well into 2023.

So what can you do to prepare your finances for more inflation next year? Consider these tips.

Get Serious About Budgeting

With inflation hitting the cost of everyday essentials the hardest, it’s important to review your household spending habits. “This can greatly help you in getting a complete picture of your financial habits and where adjustments may be made in order to maintain sufficient savings,” Sultemeier said.

For example, if you regularly exceed your food budget, you may want to look into bulk buying and meal planning to cut costs. If it’s gas for your car that’s straining your finances, investigate public transportation options. Remember, these changes can be temporary until inflation reaches ideal levels.

Avoid Emotional Money Decisions

The Federal Reserve has been in charge of keeping inflation in check. So as inflation has continued to hit record numbers, it has instituted a number of hikes to its target interest rate. Aside from making it much more expensive to borrow money, these rate hikes tend to cause the market to jump.

To continue reading, please go to the original article here:

https://finance.yahoo.com/news/prepare-now-more-possible-inflation-130028809.html

You Don’t Need Advice From An Economist

You Don’t Need Advice From An Economist

Posted by TEBI on December 14, 2022

A common misapprehension about investing and personal finance is that, to be really successful at it, you need to be an armchair economist. At the very least, people assume, it pays to know what leading economists are saying about the global economy and the financial markets. In fact it doesn’t. Even a PhD in economic theory is unlikely to help you very much. Why? Because the best financial advice has nothing to do with economics. More than anything it’s about psychology.

There are hundreds of books giving financial advice. Some of them, like Robert Kiyosaki’s Rich Dad, Poor Dad have been incredible best sellers.  According to Publishers Weekly, Kiyosaki’s book has sold more than 44 million copies.

However, very few, if any, of these books have been written by economists. And recent research suggests why.

Theory and Practice

In a paper titled Popular personal financial advice versus the professors, James J. Choi from the Yale School of Management compared the advice given in 50 of the most popular personal finance books against mainstream economic theory.

What he found is that there are some notable differences.

For example, almost every personal finance author will subscribe to the idea that you should start saving as early as possible. Most recommended investing 10% to 15% of your salary every month from your first pay cheque.

Economic theory, however, would show that this isn’t optimal. It is more rational to save very little, or even nothing, when you are young, and to ramp up your saving in middle age when you are at your peak earnings potential.

The Real World

The reason for this isn’t that hard to understand: how much you need to spend should increase at a lower rate through life than your earnings power.

A rational person wouldn’t, for example, sell their Toyota and buy a Range Rover when they started earning significantly more. They would instead use that increased disposable income to channel into their investments.

In a theoretical model, this would actually result in more savings.

In the real world, however, this is very rarely a good idea. That is because, quite simple, people are not wholly rational.

This is reflected in the three reasons why advising anyone to start saving as early as possible is far better advice, even if it is theoretically sub-optimal.

Where Economic Theory Falls Short

 To continue reading, please go to the original article here:

https://www.evidenceinvestor.com/you-dont-need-advice-from-an-economist/

How Do You Know If You’re Frugal Or Just Ridiculous?

How Do You Know If You’re Frugal Or Just Ridiculous?

The Frugal Girl  November 9, 2022

A reader question:  How do you know if you’re frugal or just ridiculous?  There seems to be a thin line. For example, is it frugal or ridiculous to postpone shopping for new undergarments for a year because new undergarments are not necessary for survival?

In the years that I have been reading content about frugality, I have noticed that this is a common theme/question/issue.   How frugal is TOO frugal?  What’s sensible, and what’s just cheap?

Where’s the line between frugality and deprivation?

I’ll write down a couple of principles I use to guide me, and then I’d love to hear your thoughts!

A few notes:

I’m writing this from the perspective of the most frugal household member since that’s always been my role

I have in mind people who are choosing to be frugal, not people who will literally go hungry if they don’t save every penny possible

Everyone gets to decide this for themselves

Since we all have different backgrounds, priorities, and sets of expectations, the answer to these questions is going to vary from person to person.

One person’s frugal might be another person’s deprivation, for example.

As long as a person’s frugal choices aren’t harming another person or harming themselves, I think they should be left in peace, even if others might happen to view their choices as too extreme.

A lot of us don’t live by ourselves, though, so…

You should compromise with other household members

The odds of everyone in your household having the exact same standards for frugality are very low.

And since some frugalities do not just affect you, you need to consider other people’s comfort levels as well. Frugality is important, but so are relationships!

This means that if a fellow household member is miserable if you keep the heat at 65 degrees, you should compromise.

Or if you don’t mind using raggedy bath towels, but a family member hates it, you should probably get some new bath towels for that person to use, even if you continue to use the raggedy ones.

And hopefully, the less-frugal members of your family will also compromise and humor you. Flexibility on both sides is key!    Most cheapness is selfish   I think the line between frugal and cheap often comes down to a selfishness issue.

When your money-saving efforts affect just you, and they don’t cause harm to anyone else, that’s frugal.

When your money-saving efforts hurt or deprive someone else, that’s when you’ve crossed the line into cheap.

To continue reading, please go to the original article here:

https://www.thefrugalgirl.com/how-do-you-know-if-youre-frugal-or-just-ridiculous/

Where Do Billionaires Keep Their Money?

Where Do Billionaires Keep Their Money?

Andrew Dehan   Sunday, December 25, 2022

Billionaires have been able to not only acquire wealth but most have gradually built it over time. This means that many have had successful investments, which makes it natural for everyone else to wonder where they are investing or keeping their money in order to see that growth. We’ve compiled a list of some of the most common investments that billionaires make when looking for sustained growth of their money over time.

Keep in mind, though, that billionaires don’t typically manage their own money and instead choose to work with a financial advisor to help with their asset allocation.

1. Cash and Cash Equivalents

Cash and cash equivalents are common places where billionaires keep of some their money. Though not often thought of as an investment, cash is a liquid asset, meaning you can use it in a variety of ways as needs or desires arise. In a crisis, having cash on hand gives you the flexibility to respond. That’s why billionaires keep a significant portion of their money in cash and cash equivalents.

However, with current rates of inflation, cash has less of an emphasis. Inflation causes the value of money to drop, so having too much of it on hand during an inflationary period can mean you lose significantly.

2. Commodities

Commodities are often another piece of a billionaire’s portfolio, and having such assets can help hedge against risk, inflation and volatility. For instance, in a scenario where inflation is causing difficulty for the rest of the market, having investments in raw materials whose price is rising can help protect you if other parts of your portfolio are suffering. People and economies depend on commodities, and inflation makes them worth more money.

Raw materials and agricultural products – like precious metals, industrial metals like copper, oil and natural gas, coffee, corn, pork bellies and soy beans – are popular types of commodities held and traded by billionaires or their agents.

3. Foreign Currencies

To continue reading, please go to the original article here:

https://news.yahoo.com/8-places-billionaires-keep-money-130030395.html

7 Wealth Building Tips Learned From Football

7 Wealth Building Tips Learned From Football

By Billy B  Mind, Money

I fell in love with NFL football 15 years ago, and it has inspired me in many ways on how to build wealth.  Once I understood the mentality, strategy, and toughness it takes to win games on Sundays, I was hooked.  A football game is much more than mindless buffalo-sized men running into each other.  It is a beautiful chess match with human beings that move like coordinated pieces. Building wealth, like football, is a thinking person’s game.  Here are seven secret wealth building tips I have found hidden inside the game of football: 

1)      Wealth Building Tip #1:  Be Patient:  Life is long.  It’s Ok to make mistakes, and it takes a lot of plays to win the game and build your wealth.  There are 60 minutes in a football game, and there’s 60+ years in a normal life.  You don’t have to win or be perfect in the first quarter or half to win.  Great football teams and players take their time, feel out the challenges that are coming at them, and then when they know what they’re doing, they strike to put points on the board.

Great wealth builders have the same mentality.  They’re patient.  They’re always learning, preparing, and planning for what’s coming ahead, and when they see opportunities to build wealth, they strike.  Great NFL teams also make mistakes during a game, but they learn from them and come back to fight again.  Financial mistakes happen to all of us.  Learn from them.  Don’t let your perfectionism get in the way.  (Click here to read an article on overcoming perfectionism)  Then get back up, learn from the mistakes, and fight to do better next time.  

2)      Wealth Building Tip #2:  It takes a team to win a championship, not just individual effort.  Football teams win championships by using all 53 men that are on their rosters.  Each player contributes different skills to create a powerful team that rises above the sum of their parts.  Wealthy people think the same way.  They are always looking to expand their network of skilled people who push, teach, and inspire them. 

Happiness is not real unless shared with others.  People who build wealth know how valuable relationships are in their life. It’s not about how smart, skilled, or strong you are as an individual.  Building wealth is all about how smart, skilled, and strong your TEAM of friends around you is. 

Wealthy people invest a large portion of their time building teams of awesome relationships who help inspire them to be better.  Grow your network of friends to include incredible people who inspire you, and you will take a massive step forward on the path to build wealth.

To continue reading, please go to the original article here:

https://www.wealthwelldone.com/wealth-building-tips/

Top Wealth Management Firms

Top Wealth Management Firms

By Mark Kolakowski  Updated on September 2, 2022

When you're in the process of selecting the best wealth management firm to work for, some factors to narrow the field is to focus on the top firms in to look at profitability, wealth manager head count and outlook for the wealth management business shared by the management.

What Is a Wealth Management Firm?

Wealth management firms offer a wide range of financial and investment advisory services, typically, to high networth clients. Although the definition of the wealth market is a highly elastic one and it can vary by firm, a generally accepted variant includes clients with at least $1 million in financial assets, but many firms set the bar lower.

Here's a look at some of the big named wealth management firm, in no particular order.

UBS

In 2021, UBS generated roughly $4.8 billion in pre-tax profit from wealth management activities, representing a little over 50% of $9.48 billion pre-tax profit for the firm as a whole.1

While UBS is known for its aggressive cost and headcount-cutting, at the end of 2021, UBS had more than 9,300 financial and wealth advisors.2

Note:  In January 2022, UBS agreed to acquire digital wealth management company Wealthfront in a push to attract Gen Z and millennial wealth management client. The deal will add more than 470,000 clients with over $27 billion in assets to UBS.3

Bank of America

Many people know Bank of America as their friendly neighborhood Bank offering senior citizens free checking.  Actually, Bank of America is the parent company of Merrill Lynch, and it also includes its Bank of America Private Wealth Management divisions in its segment reporting for Global Wealth and Investment Management.

In 2021, the net income for Bank of America's global wealth management business, clocked nearly $4.33 billion. At the end of 2021, the company had a huge roster of more than 18,800 wealth advisors.4

Wells Fargo

Wells Fargo offers diverse wealth management services. For 2021, Wells Fargo's wealth and investment management business segment reported net income of over $2 billion, which represents around 9% of the the firm's total $21.5 billion net income for the year.5

To continue reading, please go to the original article here:

https://www.thebalancemoney.com/top-wealth-management-firms-1287460

What Does Financially Independent Mean?

What Does Financially Independent Mean?

Financial Independence Explained

By Miriam Caldwell  Updated on July 1, 2022

For most people, it is hard to reach financial independence without a job that allows them to be self-sufficient. But it's taking young people longer to reach this milestone than it did in the past. Forty years ago, most people were able to get a job that made them financially independent in their 20s. Today, according to a study from the Georgetown University Center on Education and the Workforce (CEW), it takes most young adults until their 30th birthday to get a job that allows them to support themselves fully.1

Even if you are still searching for a job that allows you to be economically self-sufficient, you can still take steps to work towards becoming financially independent. Learn more about financial independence and how you can take steps to get there more quickly.

Key Takeaways

To be financially independent, you must have enough income to cover your own bills and expenses.

Many young adults struggle to be financially independent of their parents due to the rising cost of living.

To work towards financial independence, begin saving to move out on your own, pay down debt, and manage your money with a budget.

Being financially independent also means planning for the future. Invest for retirement, build an emergency fund, and work toward other long-term financial goals.

What Does It Mean To Be Financially Independent?

If you are financially independent, you are responsible for your own expenses. You no longer rely on a parent, guardian, or another family member to provide money for you or cover your bills. You are paying your daily expenses and planning for the future, and you are able to meet your basic needs.

Reaching financial independence will take longer for some than for others. It will also depend on your own lifestyle and needs. For example, if you need to pay for college or graduate school, you may consider living at home for a while to save money. In this case, financial independence would be a few years away.

Note:  Financial independence can also be the point where you no longer need to work in order to cover your daily expenses. For most people, this won't occur until retirement.

When To Become Financially Independent

Working towards financial independence may mean different things depending on the cultural and social environment that you grew up in. Some families may expect adult children to fully support themselves beginning at age 18. For others, it may be expected that adult children will continue to live at home or receive assistance from their parents, even once they are working full-time.

To continue reading, please go to the original article here:

https://www.thebalancemoney.com/when-should-i-become-financially-independent-2385820

What Is Wealth Management?

What Is Wealth Management?

Definition & Examples of Wealth Management

By Tim Lemke  Updated on June 8, 2022

Wealth management is a kind of financial advisory service for accredited investors and others with high net worth. Wealth managers provide advice about investing, estate planning, taxes, and anything else that can help grow a client's wealth.  Understanding how wealth management works and how it compares to asset management can improve your financial picture.

Definition and Example of Wealth Management

People who have a high net worth may need more services than those offered by traditional financial advisors. Those with millions—perhaps even billions—of dollars may have complex portfolios, complicated tax situations, and other needs that are unlikely to apply to average investors.

Wealth managers often have access to a wider range of financial products and services. Clients pay a fee, but they receive strategies designed with their finances in mind. Services offered by wealth managers may include:

Investment management and advice, including retirement planning

Accounting and tax services

Review of health care and Social Security benefits

Charitable giving plans

Help with starting or selling a business

You likely don’t need a wealth manager if you don't have a high net worth. You may instead prefer to pay for a financial or investment advisor who can help you grow your money over time.

Note:  A financial advisor may be able to help you build your wealth. But a wealth manager can help you manage your money when you’ve already achieved a high net worth.

How Does Wealth Management Work?

Like most financial advisors, wealth managers earn their income by taking a percentage of the assets they manage. These fees can vary among firms and even across different types of accounts within the same firm. You can expect to see fees start around 1% of assets under management.

Breaking into wealth management is a good career move for financial advisors. A wealth manager would earn $50,000 in commissions in a year from one client if they were to charge a fee of just 0.50% to a client with $10 million in their portfolio. The more clients a wealth advisor has, the more those fees add up.

To continue reading, please go to the original article here:

https://www.thebalancemoney.com/wealth-management-4772460