Brian Hernandez’s 5 Financial Tips for 2019

The path to a financially secure tomorrow.

It’s unlikely to surprise anyone that besides exercise and weight loss, getting a better handle on finances is the most common New Year’s resolution. In fact, there’s a pretty good chance this has been a goal of yours, either in the past or going into 2019.

Although we all have different financial situations, there are 5 universal tips with the power to make a difference — no matter who you are. Not only do I teach others the importance of these tips, but I also follow them in my own life, and I’m happy to share them with you.

1.    Craft a budget and stick to it:

It’s essential to have a systemic way of keeping track of your expenses, one that helps you differentiate between your needs and your wants. Create a budget that’s easy to follow, concise and realistic. Always strive for simplicity and try not to spend more than you earn. You’ll quickly see that taking the time to get organized makes all the difference in understanding your finances.

2.    Create a “Rainy Day Fund”:

We all know unexpected things happen, but you can be prepared. Maintain an adequate level of savings to rely on for when things don’t go as planned. Your “Rainy Day Fund” should be equal to three to six months of expenses. Having this buffer will provide peace-of-mind; there’s security in knowing you can stay afloat while figuring out your next steps.

3.    Monitor your credit score and pay high-interest debt first:

Having excellent credit is an impactful tool that allows us to purchase things we’d otherwise not be able to afford. However, this benefit comes at a price — interest charges can become a significant weight on our shoulders if we borrow more than we can reasonably pay back. It’s important to maintain low levels of debt and prioritize paying down high-interest accounts first to avoid paying lots of interest.

4.    Identify your bad habits, eliminate them, and stay consistent:

We all do it, we grab that morning coffee on the way to work. It’s relatively inexpensive — right? Well, let’s say your morning purchase costs $3 and you buy one each day, including weekends. That amounts to an annual coffee expense of $1,095… turns out that morning cup of coffee isn’t so cheap. Remember, the small things add up; it’s important to recognize and address bad financial habits, despite how “harmless” they may seem.

5.    Keep track of your net worth:

Tracking your net worth can provide a holistic view of your financial health. To calculate your net worth, add up your total assets and then subtract your total debt, or liabilities. Keeping track of your net worth will shed light on the financial progress you’ve made, as well as highlight the behaviors keeping you from achieving your financial goals. There are many tools and applications available to track this, such as Mint, Quicken, and Personal Capital.

You just may amaze yourself.

As you move forward through 2019, look back at these universal tips to help stay on track. If you slip up, don’t worry, just pick up where you left off. Remember, keeping a resolution isn’t always easy, but if you stay diligent and focused, you might just be amazed at what you can accomplish.

Brian Hernandez is a Corporate Banking Credit Analyst with Citizens Bank and a member of UWRI’s Young Leaders Circle. In 2018, he was presented with the Young Leaders Spark! Award in recognition of his volunteerism and commitment to the community. Brian delivers financial literacy workshops to low-income Rhode Islanders through Amos House, Crossroads Rhode Island, and McAuley House. He has also helped hopeful U.S. residents prepare for their Citizenship exam.