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Here’s Your Financial Permission Slip: What You Can and Can’t Get Away With This Year

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Save more, spend smarter, and make your money go further

Finance is very black and white.

  • You pay interest, you lose money.
  • You spend now, you can’t save for later.
  • You have fixed expenses and variable expenses.

Etc. etc. Rinse. Repeat.

And best practices are, well, the best practices for a reason. Those who adhere to them tend to do better (financially) than those who don’t. Right?

But for those of us (like me) who have multiple financial priorities and just one paycheck, I prefer a list of items where it’s okay to financially fudge (a little) and instead focus on the things making the biggest impact.


Here’s your financial permission slip for the year:

  • Do max out your 401k.
  • Do pay attention to the news and keep an eye on interest rates.
  • Do start a savings account, even if it’s small.

But we’re getting ahead of ourselves, there are a few reasons why these should be at the top of your list of financial to-dos this year.


What You Can *Actually* Get Away With…


Squeezing your budget for travel

The good news: there has never been a better time to travel. With a strong U.S. dollar, ever-present technology, cheap flights, and decreasing language barriers, we’re living in an era where it’s easy to be a global citizen.

The bad news: This might not always be the case. The economy always ebbs and flows, so prices for things like food and gas, may not always remain strong. The point is, it’s okay if you want to stretch your budget and travel a little while you can. You know the old adage: spending on travel is the only thing that makes you richer.


Having less than decent credit

Do not misunderstand me; it’s always important to have good credit and to stay out of debt. But in 2019 consumers will see a boost to their credit scores when FICO rolls out a new scoring system.

The new system takes into account not just your credit activity, but your savings and overall checking account history. If you’re one of the four million people who’s bank has opted into the new system, your score could see a 20 point boost.


Skipping blockchain investments

There’s more to blockchain than just Bitcoin. Despite the increasing popularity of blockchain technology investments (especially among millennials), it’s still new territory. Warren Buffett’s #1 rule of investing is, “invest in what you know.”

This means if you don’t understand how blockchain technology works, or what cryptocurrency is, don’t put money in it.

Even if your tech-savvy cousin keeps raving about how much money he’s made.


What You Can’t Get Away With…


Neglecting your 401k

Perhaps you’ve heard your parents discussing their retirement options, or you’ve seen the looming “retirement crisis” as a topic on the news.

The good news: You’ve still got plenty of time to save for retirement if you’re in your late 20’s/early 30’s and start contributing this year and make a concerted effort on saving throughout the years you raise children and put them through college (if applicable.)

The bad news: This is not a drill. Only half of Americans currently have enough saved for retirement and the American population is aging with not enough money or social security to support it. By 2035 Americans over the age of 65 will outnumber working-age adults.

The easiest way to set aside funds for retirement is to take advantage of any workplace options offered by your employer. This is the most important item to check off your financial to-do list this year.


Ignoring interest rates

Interest rates rose four times in 2018, and the Federal Reserve Bank has committed to raising interest rates two more times in 2019. Rising interest rates may not seem like a big deal, but they impact how much interest banks offer for their savings accounts, and how much they’ll charge you for a loan.

When borrowing for your first home, for example, a .25% interest rate increase on a $250,000 30 year mortgage can cost an extra $14,000 over the life of the loan.

It’s important not to make an expensive purchase before you’re ready, but if you are contemplating home ownership in the next few years but are already in a place to do so, you may save more money doing it in 2019.


Not having a savings account

The good news: It’s 2019. Even if you are the absolute worst when it comes to saving money, there are now more apps than ever that can sync to your checking account and squirrel away money on your behalf. Even if it’s just a few cents or a dollar here and there, that money can add up.

The bad news: You could still get caught in a bad emergency without a safety net if you don’t start saving. Start saving. It’s 2019.

As a lifelong spender, these technologies are now a part of my financial routine. I already have an emergency fund, but I keep little “pockets” of money hidden away on these apps. Sometimes, when I want something nice for myself, like a massage, I can use this money instead of putting in on the credit card (like I did in the old days).

Then, the other day my little “pockets of money” paid for the registration on my car.


Doesn’t it feel liberating to only have three big financial goals for the year? Imagine what you can do for yourself (and your finances) with all of that newfound free time.

Save more, spend smarter, and make your money go further