As the new year is quickly approaching and the holiday season winds down, it’s the perfect time for a financial check-up. Let’s reflect on how much we’ve accomplished this year and set the stage for financial success in the upcoming year with some year-end planning. If you haven’t scheduled a meeting with your advisor yet, now is the time to get your financial planning done. It is actually a good idea to schedule your year end meeting at the beginning of the fourth quarter.
Many of us set ambitious financial goals, but how often do we follow through with them? It’s time to take a page from the mentally strong and map out some to-dos to achieve our financial objectives as we head into the new year. Remember how important reaching financial independence is? Yes. Here are six things that you can do to ensure that you are on a path of financial health.
Maintain a Positive Outlook Toward Finances:
Mentally strong people understand the power of a positive attitude in taking control of their financial circumstances. As Winston Churchill once said, “Attitude is a little thing that makes a big difference.” Positivity is a hallmark of financially well-off individuals, and it’s crucial to affirm your financial goals confidently and specifically.
Surround Yourself with Like-minded Individuals:
You are the company you keep. Pick good savers who lift you up. Jim Rohn, a renowned motivational speaker, advises, “You are the average of the five people you spend the most time with.” Successful individuals often associate themselves with trustworthy, motivated peers who share their financial vision. Research shows that over 85% of the rich make a habit of surrounding themselves with goal-oriented, success-driven people.
Dedicate Yourself to Lifelong Financial Learning:
Albert Einstein, one of the greatest minds in history, emphasized the importance of learning: “Intellectual growth should commence at birth and cease only at death.” Mentally strong people are lifelong learners, constantly seeking ways to improve themselves and their financial knowledge. They understand that knowledge is the key to self-confidence and mental toughness.
Keep Emotions Separate from Financial Decisions:
Warren Buffett, a legendary investor, emphasized the significance of emotional control in financial decisions: “The stock market is designed to transfer money from the Active to the Patient.” While emotions naturally influence our decisions, mentally strong people rely on trusted financial experts to help them make rational choices. Strong relationships with financial mentors limit risk and ensure that emotions don’t dictate financial decisions.
Have a Spending Plan:
Elise Boulding perfectly articulated the concept of living below your means: ‘Frugality is one of the most beautiful and joyful words in the English language, and yet one that we are culturally cut off from understanding and enjoying. The consumption society has made us feel that happiness lies in having things, and has failed to teach us the happiness of not having things.’ Mentally strong people have the financial discipline to hold off on buying the latest luxury goods, keeping what they pay in subscriptions in check and not going on off-course shopping. It’s all about “needs” vs. “wants.”
Having a financial plan can lead to significant financial benefits. According to a recent survey conducted by Forbes Advisor in March 2023, [66%] of Americans reported being able to save money in the past year. Factors contributing to this savings success included increased interest rates (50%) and pay increases (35%). This data underscores the importance of prudent financial habits, like living within one’s means, in achieving financial security and success.
Pay Yourself First:
George S. Clason, author of “The Richest Man in Babylon,” really drilled in on the importance of paying yourself first: “Start thy purse to fattening.” Mentally strong people prioritize their financial well-being by setting aside money for their future before paying bills or indulging in discretionary spending. It’s all about preparing early. This consistency and practice allow them to invest in assets that potentially generate income and help save for their financial future. As you engage in year-end planning, remember that you’re not alone on this financial journey. These habits of mentally strong individuals, along with guidance from a financial advisor, can guide you toward a strong end of the year and set the stage for a prosperous planning year ahead. Happy New Year!
Words by Winnie Sun
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