Start the Year Off Fresh

A new year means a fresh financial start. Have you thought about what financial improvements you’d like to make? Take some time to think about what you’d like to accomplish and write them down - a study revealed that people who set goals and write them down are 1.2 to 1.4 times more likely to accomplish them than those who don’t

Here are three steps to help you get started in the new year. 

1. Establish your goals.

It’s easy enough for people to tell you to create goals, but how do you really create attainable goals that you can hold yourself accountable to?

Your goals should be SMART — an acronym coined in the journal Management Review in 1981 for specific, measurable, achievable, relevant, and time-bound. It’s a popular method in the workforce, but it can also work in setting your resolutions, too.

Specific. Your resolution should be absolutely clear. Make a concrete goal rather than just vaguely saying ‘I want to save money.’ How much money do you want to save and at what time interval? 

Measurable. This may seem obvious if your goal is a fitness or weight loss related one, but it’s also important if you’re trying to cut back on something, too. If, for example, you want to cut back on ordering takeout, use an account aggregator tool to help you visualize your goals and see your savings account grow.

Achievable. This doesn’t mean that you can’t have big stretch goals. But trying to take too big a step too fast can leave you frustrated, or affect other areas of your life. So, for example, resolving to save enough money to retire in five years when you’re 40 years old is probably not realistic, but saving an extra $100 a month maybe. (And if that’s easy, try increasing that number up to an extra $200, $300, or $400 a month).

Relevant. Is this a goal that really matters to you, and are you making it for the right reasons?

Time-bound. Similar to “achievable,” the timeline toward reaching your goal should be realistic, too. That means giving yourself enough time to do it with lots of smaller intermediate goals set up along the way. Remember to always celebrate your small victories! 

2. Start investing for the long term.

Do you know how much you’ll need when you retire? Most likely not. Here are three investment accounts to consider for growing your money, long-term.

Traditional 401(k). A 401(k) is a savings plan offered by your employer that allows you to take a portion of your paycheck and invest it while deferring the income taxes on the saved money until you withdraw the money at retirement.

If your employer offers a 401(k), consider signing up. If you’re already making contributions, consider increasing the amount or max it out. The best way to invest in a 401(k) is to make sure you’re contributing enough to get your employer match. This is free money!

Traditional IRA. A traditional IRA is a personal savings plan with tax advantages for retirement savings. Contributions may be tax-deductible - either in whole or in part. Contributions and earnings are not taxed until you withdraw them at retirement. 

Roth IRA. A Roth IRA is another personal savings plan that differs from a traditional IRA in that contributions are not tax-deductible, yet the qualified distributions (including earnings) are potentially tax-free.

The earnings on a Roth IRA are tax-free and withdrawals are also tax-free, as long as you make the withdrawals after the age of 59 ½.

3. Get to know your financial institution.

If it’s been a while since you’ve talked to your banker or financial advisor, it might be time to pay a visit. They can help identify products and services to maximize your finances. Your financial institution can help identify the best strategies for you.
What will you tackle first?

As always, Pioneer is here to help you reach your financial goals. We have empowered our staff to support your specific needs. Should you have questions regarding your account, online resources, or are experiencing a financial difficulty, contact a Branch or our Customer Care Team at 518.730.3000 for assistance.
The material provided on this website is intended for informational purposes only. Links to other web sites are provided for reference and do not constitute a referral or endorsement by Pioneer or its affiliates. Please note that such material is not updated regularly and that some of the information may not be current. It is recommended that you consult with a financial professional for assistance regarding the information contained herein.