8 Financial New Year's Resolutions for 2021 | AU Small Finance Bank
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8 Financial Resolutions You Need to Keep in 2021

    As you step into the new year, set some financial goals for yourself. This will not only help you reach your life goals, but will also keep you secure in case things go wrong along the way.
     
    Want to set some financial resolutions for the new year? Read the blog below to know exactly how to achieve your life goals planning your finances better in the new year. Simple and easy to follow, these tips are great for anyone looking to maintain a healthy financial lifestyle.
     
    • 1. Review your Household Spending

    First and foremost, review your household spending. Construct a detailed list of your monthly expenses – rent, utility bills, insurance, groceries, car maintenance, etc. Cut down on unutilized luxuries like magazines, OTT memberships, and other such subscriptions, to start distinguishing between what you really need and merely want.
     
    • 2. Avoid Debts

    Avoid debts as much as possible. Do not borrow; even from your family and friends. Avoid “buy now, pay later,” “interest-free financing,” and like options that can merely postpone and increase debt. Switch to debit cards and in-hand cash as much as possible. If there are existing loans, seek help and advice from banks or any other financial expert.
     
    Carve out a monthly amount to invest in a recurring deposit. Smart and safe, RDs are ideal saving options if you do not want to take any risk with your investments. You can even continue investing in your fixed deposit accounts. Unlike other investment options, FDs are not market-driven. You get an assured sum of money at the end of the maturity period.
     
    • 4. Set up an Emergency Fund

    Take out a small amount from your income and invest it in an Emergency Fund. It will help you stay afloat at the time of crises, without having to resort to additional debt. This smart financial cushion also assures good peace of mind.
     
    • 5. Divide your Risks

    You can’t predict what the market will do at any moment, hence make sure you have a well-diversified portfolio. Different kinds of investments pose a lower risk as compared to any individual investment within the portfolio. When one asset class is underperforming, it is quite possible that another is outperforming.
    For example, you can invest in the investment options below:
     
    • Mutual Funds - Systematic investment plans (SIPs)

    Systematic investment plans (SIPs) in mutual funds allow you to invest in smaller amounts. Moreover, since Mutual funds in India are regulated by the Securities and Exchange Board of India (SEBI), your investment is safe.
     
    • Senior Citizens Savings Scheme (SCSS)

    It is an apt choice of investment for seniors. The scheme not only offers a regular stream of income, but also offers good safety and tax-saving benefits.
     
    • 6. Try a Personal Finance App

    With a personal finance app, you can manage your expenses with ease. Loaded with multiple features, these apps not only help you reach your larger financial goals, but also help you build good budgeting habits and discipline. With just a few taps and clicks, they help you make smart financial decisions on the basis of your ongoing financial behavior.
     
    • 7. Safeguard your Banking Transactions

    Technology has helped us access our money at the click of a button. However, it is important to ensure such facilities are used wisely.
    • Safeguard your banking transactions with a secure password that only you know. A strong password can be created with a mix of letters, numbers and symbols. Try not to include personal information.
    • Track your debit and credit card transactions regularly. Do not share the PIN with anyone. Set up an SMS or email alert to help you get notified about any transaction carried out on the cards.
    • Ensure you do not open or respond to messages and emails from sources you don’t recognize. If a message or email looks unusual, just delete it.  Additionally, don’t get tempted by sweepstake prizes or contests. These are usually scams.
    • Beware of malicious sites and apps while accessing NetBanking or while downloading any app.
     
    • 8. Follow a ‘No-Spend’ Day Every Week

    Incorporating a ‘No-Spend’ Day into your schedule can be quite healthy for your finances. While this might sound silly, it is a great way to save and create a positive attitude towards money. It will curb your spending, control your budget and help you stay confident and content when it comes to managing your money. 
     
    The year 2020 has taught us a lesson. It has highlighted the need to be more prepared for unprecedented times. You may have gotten by this year somehow, but remember that unforeseen circumstances come at the most unexpected times.
     
    With 2021 around the corner, you can start making a robust monetary master plan. It will help you can sail through the year peacefully. This practice will also help you become more financially stable in the long run.