Feeling overwhelmed by how much progress you need to make on your financial goals? It may be time to focus on how far you have come already rather than how far you have left to go.
Here are some major financial accomplishments that you should be proud of. And even if you aren't quite hitting those accomplishments just yet, we've got tips to help get you there.
1. Paying off debt
Don't wait until all of your debt is paid off to celebrate. Even paying off one credit card or loan is a huge accomplishment that can motivate you to keep going. You may be encouraged to pay off the rest of your debt faster, or put more money aside in your savings account.
If you feel like your debt repayment plan is not going anywhere, you might need to change up your approach to see real results. First off, commit to never making only minimum monthly payments and stop using your credit cards. If you still aren't seeing progress, consider doing a balance transfer to a promotional 0% APR credit card so that you can tackle the debt more intentionally without drowning in high interest rates. Just make sure to pay off the debt before the promotional 0% APR window closes. (See also: The Fastest Way to Pay Off $10,000 in Credit Card Debt)
2. Making retirement contributions
If a portion of your income is directed to your retirement account before it hits your bank account, give yourself a huge pat on the back. Not only are you successfully building up your 401(k), but you are also decreasing your tax burden for the year. If your company offers a match on contributions, it's even better to contribute enough to at least secure the company match. You don't want to leave any free money on the table.
Not making retirement contributions yet or only contributing a small percentage? The least painful way to up your contribution rate is to have your contribution percentage automatically increased by one to two percent every year. If you make $60,000 a year, contributing 3 percent comes out to around $75 per biweekly paycheck. You probably won't miss that money, especially if you aim to get a small raise or promotion each year.
Don't fall into the trap of thinking that your efforts are too small. It might not seem like your contributions are growing at first, but after a decade, you will start seeing the power of compounding take effect. (See also: 7 Easiest Ways to Catch Up on Retirement Savings Later in Life)
3. Getting a raise
Whether you automatically got a pay bump, or you had the gumption to ask for a raise, congratulations; you should be proud! To stay ahead of the game, make sure you don't increase your cost of living along with your bigger paycheck. Instead, live as if you never received the raise at all. If you want to treat yourself, you can put a little bit of money aside each month to reward yourself at the end of the year with something fun — so long as it doesn't negate your extra earnings.
Are you working hard but feel underpaid? There's a good chance you will never receive a raise if you don't ask for one. If your current employer won't increase your salary, start applying for positions that will grant you a higher paycheck. (See also: How to Negotiate a Raise Out of the Blue)
4. Increasing your credit score
Boosting your credit score is a great feat, especially if you've had to bounce back from a low score, bankruptcy, or an account going to collections. It takes time and dedication to increase your credit score and fix negative marks against your report, but once you are in a good credit range, you can change many other areas of your finances. You can refinance to a lower interest rate for an existing mortgage or car loan, or get a better credit card with a higher limit and better rewards. A higher credit score can also lead you to buying the home of your dreams if you've been stuck with only rentals.
Still wishing for a better credit score? It doesn't come through sheer hope. Monitoring your credit score health through free resources like Credit Sesame can help you identify the areas that are hurting your score the most, such as inconsistent payments or too much debt. One thing to note is that free credit reporting sites often use a different credit scoring metric (the VantageScore) than what lenders use when they approve you for financing. If you want a more accurate look into your credit score, you can order your actual FICO score from myFICO. Ordering your credit score from one of the three credit bureaus (Experian, Equifax, or TransUnion) will run you about $19. (See also: Is It Worth Paying for Your Credit Score?)
5. Living frugally
Here's a financial accomplishment that anyone can be proud of, no matter the size of their paycheck. Living frugally can cover a wide range of areas, from ditching meat twice a week for beans and rice, to stashing $20 a week in a savings account, to buying a used kitchen table and saving yourself $400. Any time you opt for the less expensive choice or choose to save money rather than spend, be proud of yourself.
Being more frugal in your everyday living doesn't have to be complicated. Simply packing your lunch with leftovers or pantry staples instead of purchasing a $7 meal every day of the workweek will save you $35. Similarly, inviting friends over for a game night and snacks can save you $20–$50 over seeing a movie or hanging out at the bar.
The best way to get started with living frugally is to look at your budget and identify where you spend the most money. Then come up with creative ways to decrease these costs and try them out. Take it a step further and devote the money you saved toward debt repayment or a savings account. It will add up. (See also: The Only 6 Rules of Frugal Living You Need to Know)
Stop giving yourself a hard time about not being exactly where you want to be money wise and realize just how far you have come. Do you have more money saved this year than you did last year? Do you have less debt? Are you making more money? Feel proud of the growth you have made, and work on being even more financially fit next year.
