LUTZ BUSINESS INSIGHTS
financial fitness for the new year
lisa strutzel, family office services DIRECTOR
It’s no surprise the most popular New Year’s resolution is to exercise more. After all, the holidays are a time when maintaining a fitness routine is about as easy as navigating the mall parking lot. Your body is not the only thing that may be slightly out of shape as you begin the new year. Have you assessed your financial fitness lately? Do you need to make some adjustments to make sure you’re on course and running in the right direction?
STRENGTHEN YOUR FINANCIAL GOALS
Achieving financial fitness for life is attainable but requires discipline. The key is to be “S.M.A.R.T” about the goals you set – make them Specific, Measurable, Attainable, Relevant and Timely. Think about what you want to accomplish and then work backwards, setting small benchmarks that will help you get there. Do you want to retire on your own terms? First calculate the amount you want to have in your nest egg and then set annual savings goals that will ensure you make it to the finish line.
IMPROVE YOUR GRIP ON SPENDING
Poor spending habits can be a major setback, so it’s imperative to adhere to a budget. Building a playbook for your budget begins with identifying your income and expenses. Estimating monthly income is easy enough; but understanding where all the money goes can be challenging. If you need help tracking your expenses, mobile applications that monitor spending like Mint and YNAB are designed to help you get a grip.
Once you understand the cost of your lifestyle, you can make the adjustments necessary to ensure you’re not spending more than you make. If your budget doesn’t balance on the first try, separate your needs from wants and eject the non-essentials. Don’t forget to pay yourself first by factoring your savings goals into the expense equation. Just like working on your physical fitness, your budget won’t be in shape right away; it will take a month or two to establish the healthy habits, but the end results will be lasting.
DEBT REDUCTION IS YOUR OFFENSE
In the words of David Ramsey, “Debt isn’t just borrowing money you don’t have from the bank. It’s also borrowing from your future!” Defending your income from ongoing payments by implementing debt reduction strategies can help you achieve a financial win.
It’s important to “substitute what you owe for what you can grow”. By making a list of what you owe, you can prioritize debt reduction by first paying off debt with high interest rates, such as credit cards, or even through seeking small victories by paying off your smallest balances owed.
ACHEIVE YOUR GOALS + REPEAT
Do you want to win this year with respect to your finances? Start with updating your financial goals with the end game in mind, being sure to put a hold on counterproductive spending and credit practices. Attaining better financial health takes practice and discipline, but practice makes perfect—and practicing a more strategic game plan this new year will have you perfecting your financial fitness in no time!
ABOUT THE AUTHOR
LISA STRUTZEL, CPA, CAP® + FAMILY OFFICE SERVICES DIRECTOR
Lisa Strutzel is the Family Office Services Director at Lutz with over 14 years of past experience as a family office executive. She is responsible for assisting high-net-worth clients manage their family enterprise.
AREAS OF FOCUS
- Family Office Services
- Financial Reporting
- Philanthropy and Legacy Planning
- High-Net-Worth Families
AFFILIATIONS AND CREDENTIALS
- Certified Public Accountant
- Chartered Advisor in Philanthropy, CAP®
- Family Office Exchange, Integrated Wealth Advisor Council Member
- Purposeful Planning Institute, Member
- Nebraska Society of CPAs, Member
- BBA, Iowa State University, Ames, IA
- The Hope Center for Kids, Board President, Past Treasurer
- CAP Advisory Board Member
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