If one of your New Year’s resolutions is to get your financial house in order, the steps below can help you get started on the right path:

The first step toward financial improvement is assessing your situation. That means checking the status of all your financial accounts, taking stock of your assets and debts, and evaluating your monthly cash flow. This allows you to identify areas for improvement.

In order to manage your spending, you need to develop and use a budget. Gather bills from the past few months; make a list of recurring expenses in order of importance – with true necessities like housing, food, and health care obviously taking precedence. Compare these expenses against your monthly take-home and eliminate unnecessary spending. Then regularly check in and monitor your actual spending.

This short tip is author Dave Ramsey’s best tip for every year. Taking aim at your highest-interest balances first, while making minimum payments on the rest of your debt, is one strategic way to pay off what you owe. Alternatively, you can tackle the smallest total debt amount first, providing a quicker sense of satisfaction, then move on to pay off the remaining debts with higher total amounts.

The difference between a good credit rating and a poor one can mean paying a greater amount of interest charges on credit cards, auto loans, and mortgages payments EACH YEAR. A good credit rating can provide savings in other ways as well since your credit standing impacts your insurance premiums, your ability to buy a car, rent an apartment, the types of loans you’re eligible for, and the types of jobs you can land.

Retirement, emergency funds, college, and vacations all vie for your savings dollars. One approach to saving for all of these needs is to establish a separate account for each and fund it with automatic monthly contributions from a bank account.

Integrating these long-term goals into your budgeting process will help you allocate your resources appropriately and track your progress toward reaching them.

Aldrich Wealth LP helps our clients protect and grow their financial assets for the future, by helping them make smart financial decisions today. If you would like assistance in determining your retirement needs, please call Aldrich Wealth at 888-299-3102.