Every year, millions of people welcome January with a renewed sense of purpose. There’s something energizing about a fresh start - a clean calendar, new goals, and the chance to build healthier habits. And while resolutions range from fitness to organization to personal growth, improving one’s finances remains among the most common (and most meaningful) commitments people make.
But here’s the truth - resolutions are easy to set and challenging to maintain. Motivation fades, routines get disrupted, and old habits creep back in. That’s why knowing exactly what to focus on and having a practical plan to follow gives you the best chance of success. In this article, we’ll explore four of the most popular financial resolutions and share realistic steps to help you make progress this year.
Popular Financial New Year’s Resolutions
Every household has different financial goals, but year after year, four resolutions consistently rise to the top:
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Improving your credit score
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Saving more money
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Eliminating high-interest debt
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Following a budget
Individually, each one has the power to strengthen your financial situation. But many people don’t realize just how closely these goals are connected. A stronger credit score makes it easier to refinance debt or qualify for lower rates – saving you money and preventing high-interest debt. Saving more helps you avoid relying on costly credit cards when unexpected costs appear. Following a budget gives you the structure to do both.
Progress in one area often creates momentum in the others. With that in mind, let’s break down each resolution and walk through practical ways to achieve them.
Financial Resolution #1: Improving Your Credit Score
Your credit score is more than a three-digit number. It influences the cost of borrowing, determines whether you qualify for certain loans, and often affects major life decisions, such as renting an apartment or landing a specific job. Strengthening your score is one of the most impactful financial moves you can make.
Four Ways to Improve Your Credit Score Quickly:
1. Review your full credit report.
Visit www.AnnualCreditReport.com to download free reports from the three major bureaus (Experian, Equifax, and TransUnion). Scan for inaccuracies, such as unfamiliar accounts, incorrect balances, or outdated information. Errors are more common than many people realize, and by correcting them, you can boost your score almost immediately.
2. Decrease your outstanding credit card debt.
Paying down credit card balances is one of the quickest ways to lift your credit score because it directly improves your Credit Utilization Ratio (CUR), which accounts for about 30% of your score. Focus extra funds on existing balances and try to avoid adding new charges while you work toward lowering your outstanding balances. Even small reductions can make a noticeable difference.
3. Consolidate high-interest debt into a lower-rate personal loan.
Replacing several credit card payments with one lower-rate loan can make repayment more manageable. The predictable monthly payment helps you stay consistent, and the interest you save can be redirected toward paying down the principal balance faster.
4. Set up automatic payments.
Payment history is the largest factor in your credit score - 35%. Scheduling automatic payments, even if they’re just for the minimum due, ensures you never miss a due date. You can always make additional payments manually, but this safeguard protects you during busy months.
How This Resolution Supports Others
A higher credit score can help you qualify for lower loan rates, especially for major loans like vehicles or home loans. Saving money on interest frees up more room in your budget, which you can use to grow savings or reduce other debts.
Financial Resolution #2: Saving More Money
Saving money is a resolution many people make enthusiastically in January, but they struggle to follow through as the year progresses. Between unexpected expenses and day-to-day temptations, it’s easy to watch savings fall to the bottom of the priority list. The right habits can change all that.
Four Ways to Save More Money:
1. Automate your savings.
One of the most effective strategies is simply removing the decision altogether. Using payroll deduction or automatic transfers ensures money is added to your savings before you even see it. What starts small can become a steady habit over time.
2. Keep savings in a separate account.
Opening a separate savings account with the credit union provides a healthy barrier between “spending money” and “future money.” When your savings aren’t mixed with everyday funds, you’re far less likely to dip into them impulsively.
3. Pay yourself first.
Treating savings like a normal monthly bill creates structure and consistency. Instead of saving whatever is left over, which is often very little or nothing at all, you’re making your long-term goals a priority from the start. Pay your “savings bill” directly into your savings account at the beginning of each month.
4. Use Share Certificates to build long-term savings.
Share Certificates (often called Certificates of Deposit, or CDs) typically pay higher rates in exchange for leaving your money untouched for a set term you choose (often ranging from six months to five years). It’s a simple way to earn more while preventing yourself from withdrawing funds prematurely.
How This Resolution Supports Others
Building savings gives you a cushion for unexpected expenses. That means fewer emergencies end up on high-interest credit cards or costly payday loans, which helps protect your credit score and prevents expensive debt from piling up.
Financial Resolution #3: Eliminating High-Interest Debt
High-interest debt can quietly drain your budget and limit your financial flexibility. The good news is that there are several ways to reduce that burden and regain control of your money.
Four Ways to Eliminate High-Interest Debt:
1. Consolidate into a lower-rate loan.
Debt consolidation moves multiple high-interest balances into a lower-rate loan. The interest savings alone can help you make faster progress, and the streamlined structure removes the stress of juggling numerous due dates.
2. Refinance loans when rates improve.
If your credit score has improved or market rates have dropped since you borrowed money, refinancing the loan with the credit union may reduce your monthly payment and help you pay it off sooner. Even a small rate reduction can generate substantial savings over time.
3. Try the Snowball Method.
The Snowball Method is an effective and simple debt repayment strategy. Start by allocating extra payments to your smallest loan or credit card balance, while keeping up with minimum payments on the rest. Eliminating that first debt creates motivation, and rolling those payments into the next lowest balance builds momentum.
4. Consider a Home Equity Line of Credit (HELOC).
Homeowners may benefit from using a HELOC to consolidate high-interest debt. Because it’s secured by your home, the rate is often much lower than that of unsecured debts. It’s a powerful tool when used responsibly, and the longer terms keep monthly payments affordable for any budget.
How This Resolution Supports Others
Reducing high-interest debt frees up more room in your budget, allowing you to save more or pay off other debts quicker. As your balances fall, your credit utilization improves, which naturally lifts your credit score.
Financial Resolution #4: Creating & Following a Budget
A budget doesn’t restrict your life - it helps you design it. With a clear plan, you can confidently manage your income, keep expenses in check, and make real progress toward your financial goals.
Four Ways to Create & Follow a Realistic Budget:
1. Review several months of expenses.
Gather financial statements, receipts, and credit card transactions for the past several months. You want to use a few months to identify spending patterns and expenses that might not occur monthly, such as holidays or birthdays. Categorize your spending to see exactly where your money goes. This process is often eye-opening, as you may not have realized how much you were spending in specific areas.
2. Understand your true monthly income.
Many people overestimate what they take home. Once you know the real number, explore opportunities to boost your income, such as working extra hours or overtime, taking on a seasonal part-time job, or freelancing projects on the side.
3. Use the 50/30/20 budget.
The 50/30/20 is a framework that makes budgeting simple: 50% of your income is designated for needs, 30% for wants, and 20% for savings or extra debt payments. It’s flexible enough to adjust as life changes, but it’s also structured enough to keep you aligned with your goals.
4. Hold yourself accountable.
Budgeting is a continuous process. Schedule time on your calendar to review your budget monthly. This process helps you catch issues early and adjust as needed. Remember - mistakes will happen. Budgeting is not about being perfect - it’s about making progress. Learn from any financial hiccups, plan how to avoid them in the future, and keep moving forward.
How This Resolution Supports Others
A solid budget creates the foundation for saving more, paying down expensive debt quicker, and protecting your credit score. It ties all your financial goals together and brings clarity to your progress.
We’re Here to Help!
Improving your credit score, building your savings, eliminating high-interest debt, and creating a realistic budget are all powerful resolutions to strengthen your financial wellness. These goals work together, and even small steps can produce meaningful change. Consolidating high-interest debt is often an excellent place to start because it immediately reduces monthly costs and creates space in your budget to pursue your other goals.
If you want to learn more about debt consolidation and how it can instantly save you money, we’re ready to help. Visit any of our convenient branch locations or call XXX-XXX-XXXX to schedule an appointment with a member of our lending team.