5 Financial Lessons To Take With You Into 2023
The end of the year is a natural time for reflection and slowing down. It’s also a great time to take stock in what you’ve learned throughout the year so you can make changes for the year ahead. Here are five financial lessons that you may have learned this year, that can prepare you for what to expect with next year’s finances.
It’s Important To Have A Plan, And It’s Important To Roll With The Punches
When it comes to your finances, it’s important to have a plan. A financial plan helps you to stay on track so that you can keep your goals in mind, but it’s also important to remember that we can’t predict what may happen with the stock market. We all felt that this year when stocks, bonds, alternatives, basically everything had a trying year. While having a plan in place is a critical part of financial planning, you also need to be able to roll with the punches and make adjustments as time goes on.
When markets are in a downturn, it can be difficult to have faith that they will recover. And while no one can tell you when or how markets will recover, understanding that investing is for the long term and that long term growth is built to withstand volatility can help you to weather the storm. Putting your faith in a financial model or system may help you to see the bigger picture and remain calm when the market experiences periods of volatility, because you may feel more secure that you’re investing for the long term.
Be Comfortable With The Uncomfortable
So much of life in general is learning to be comfortable with what is uncomfortable. We can’t grow and learn knew things without a small degree of discomfort, and the same can be said for investing. There’s always an element of risk when it comes to investing which may inherently make you feel a sense of discomfort, but unless you face that discomfort head on you can’t learn those new skills and knowledge to grow. Dealing with market volatility, inflation, and various other factors can make investing feel uncomfortable some days, but again – it’s a long-term process, and in order to grow and learn, you’ve got to be comfortable dealing with the uncomfortable.
Find Your Happiness
We have a choice in how we look at life, and what events shape our happiness. During the end of the year, reflect on what made you happy throughout the year. These years in the wake of the pandemic have caused many of us to reevaluate our lives and to focus on happiness. One way to focus on your happiness is to make a list of what you’re grateful for and continually add to it. Another is to fill your life with meaningful work and meaningful relationships. Let the people in your life know that you appreciate them, not only during this time of year but throughout the whole year through.
Review Your Finances
The end of the year is an excellent time to review your finances and plan ahead for next year. Take a look at your spending over the year and see what sticks out to you, see if you need to adjust your budget for next year. Review your contributions to your retirement savings and see if you need to make any increases. Take a look at your tax planning, estate plans and ensure that your insurance is adequate.