The Top 5 Personal Finance Resolutions In 2020 And How To Achieve Them
Jan 01, 2020 • 4 min read
If you’re like most Canadians, you’ve probably started thinking about setting New Year’s resolutions for the coming year. In fact, a recent survey by Willful found that 76% of Canadians have already committed to at least one personal finance resolution in 2020. While the number of Canadians who actually follow through and accomplish their New Year’s resolutions are slim, it doesn’t have to be that way. We’re here to give you the tips to stay on track with your personal finance resolutions in 2020.
1. Pay off debt
46% of Canadians have made a New Year’s resolution to pay off debt in 2020. Debt can feel like a heavy weight on your shoulders, especially when you have multiple outstanding debts like student loans, credit cards, or a line of credit. The key is to focus on paying off the most expensive debt that charges you the most interest. Once that’s paid off, continue on to the next most expensive debt until you’re only left with your least expensive debt. This is just one strategy that will help you eliminate it quicker (and it also provides some relief as you see progress and pay off debts).
Another successful strategy (that saves you the work above) is using Borrowell to consolidate your debt into one affordable monthly payment. Whether you have credit card debt, just bought a car, plan on making major home renovations, are opening a business, or doing all of the above, Borrowell makes your life easier with personalized loans that save you money on interest and help you pay off debts quickly.
2. Make a will
25% of Canadians have made a New Year’s resolution to make a will in 2020. Most of us know that we need to make a will, it’s just a matter of actually getting around to doing it. If you have a simple estate (most Canadians do) you don’t have to take time off work to visit a lawyer or shell out thousands of dollars - you can get a will in less than 20 minutes with an online platform like Willful (for a fraction of the cost of visiting a lawyer). Willful is available for residents of Ontario, British Columbia, Alberta, Manitoba, Saskatchewan, Nova Scotia, and New Brunswick - and Borrowell readers can get $10 off any plan by using code BORROWELL10.
3. Get life insurance
5% of Canadians have made a New Year’s resolution to get life insurance in 2020. You might not know that you don’t actually need to work directly with an advisor to get life insurance - increasingly, life insurance is moving into the digital age and you can get life insurance online from a company like GoLife, PolicyMe, or PolicyAdvisor, which use technology to help you quickly and easily get a policy in place that fits you and your family.
4. Open an RESP
5% of Canadians have made a New Year’s resolution to open an RESP in 2020 - it’s free money from the government! A quick and easy way to save for your child’s education is by opening an RESP with Wealthsimple. It only takes five minutes to set up an RESP, and they’ll begin building you a personalized investment portfolio that helps grow your education savings. Wealthsimple’s fees are far less than what most investment managers charge and you also get $10,000 managed free for a year when you sign up for a new Wealthsimple account.
5. Create and stick to a budget
30% of Canadians have made a New Year’s resolution to create and stick to a budget in 2020. Everyone’s budget is different. That’s why it’s important to sit down and figure out a budget that works for you. You’ll need to calculate your total income, your total necessary expenses (rent or mortgage, utilities, groceries, etc.), your “fun” expenses (subscriptions, takeout, shopping, travel, etc.), and any unexpected expenses (medical bills, vet bills, home repairs, etc.). This will give you a better idea of the larger spending trends and identify any areas of concern where you might need to cut back.
Next you’ll need to identify your financial goals, and incorporate these into your budget. To help you actually stick to your budget, you should always allow your personality and lifestyle to be reflected in your budget. In the same way people yo-yo diet, many people yo-yo budget and fall off track many, many, times. That’s why it’s so important to set a budget that’s realistic for you. For example, if you take a more casual attitude towards money, don’t try to completely eliminate fun spending. Most people need to allow themselves at least some discretionary spending (we’re all human - not walking excel spreadsheets). Many people find it helpful to put their budget somewhere they’ll see it everyday to give them the reminder they need and ensure it remains a long-term priority.
Happy New Year and best of luck on accomplishing your personal finance resolutions in 2020!
Willful is alternative to traditional estate planning, allowing Canadians to make end-of-life arrangements quickly and easily. Willful's self-serve online platform breaks down the estate planning process into simple steps, allowing Canadians to create essential estate planning documents in 20 minutes or less.