According to Pew Research, 44% of people believe the financial impact of the COVID-19 pandemic is long-lasting. They believe it’ll take them three years to recover to pre-pandemic financial situations. Whether you’re in that group or don’t think the pandemic hit you financially, making financial resolutions for the new year can be a positive practice. They help you choose some money and credit goals to focus on and let you work toward recovery, savings, or growth in realistic ways.
1. Start Using ExtraCredit to Manage Your Credit Profile
The more you know about your financial profile, the better off you’ll be. You can work on monitoring, building, protecting, and restoring your credit history with ExtraCredit®. ExtraCredit includes five powerful tools to help you stay on top of your credit:
Build It: Build It lets you add your rent and utility payments as tradelines on your credit report with the credit bureaus. This can help you add positive payment history for things you’re already paying on-time.
Guard It: In 2020, more than 1.4 million identity theft reports were filed with the Federal Trade Commission—that’s almost double the number from 2019. Guard It comes with Dark Web monitoring, which scans hidden sites and nefarious file sharing sites for consumer data breach information. Guard It also includes a compromised account monitoring feature and valuable identity theft insurance.
Track It: Believe it or not, you have at least 28 different FICO® scores. That’s a lot to keep on top of. Thankfully, you can keep track of all of them through Track It.
Reward It: You can earn money every time you’re approved for a select offer in the Reward It feature.
Restore It: Credit score looking a little low? Restore It connects you with a leading credit repair company so you can begin to work on inaccurate or unfair negative items on your credit. Better still, you can get a discount with CreditRepair.com or another leader in your area.
2. Build Your Savings Account
Start a savings resolution today by making a goal and breaking it up into smaller, realistic amounts. Want to save $3,000 this year? That’s only $250 a month or around $63 per week.
Consider automating deposits into your savings account to make it more likely you’ll succeed in your financial resolution. You could have $100 of every biweekly paycheck deposited to your savings account, leading to $2,600 in savings by the end of the year.
If you’re looking for a brand new mobile financial app, why not give Chime a go? Chime has a lot of neat features, including a clever automatic savings tool and a competitive 0.50% Annual Percentage Yield1—8x2 the national average!
Your payment history makes up 35% of your credit score. If you don’t pay your bills on time, your financial outlook can suffer. Make a resolution to avoid late payments this year. If you’re busy or somewhat forgetful, here are some tips to help you stay on schedule:
Automate bill payments with options like the Tally App
Set reminders on your phone or computer
Write payment dates on a calendar
Create a bills spreadsheet
4. Get Your Taxes Done Early
Enjoy doing your taxes? No, neither do we. But there are some potential benefits to filing early. If you file your taxes before the rush that occurs late in the season, you could get a faster refund. You’ll also reduce the chance of identity theft, avoid penalties, and—if applicable—give yourself extra time to save for your tax bill.
5. Open a Few New Credit Accounts
The more account types you have in good standing on your credit report, the more likely you are to get approved when you go for a low-interest car loan, personal loan, or mortgage. Lenders scrutinize your credit report—and they look for a good mix of account types.
Revolving accounts include credit cards, store cards, and home equity lines of credit (HELOCs). Installment accounts are products like personal loans and car loans, which have fixed monthly payments. Open accounts, like charge cards and utility accounts, require payment in full each month. Your credit mix accounts for 10% of your credit score.
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*To qualify for the welcome bonus, you must open and fund a new Rewards Checking Plus account through Upgrade and make 3 qualifying debit card transactions from your Rewards Checking Plus account within 60 days of the date the Rewards Checking Plus account is opened. If you have previously opened a checking account through Upgrade or do not open a Rewards Checking Plus account as part of this application process, you are not eligible for this welcome bonus offer. Your Upgrade Card and Rewards Checking Plus account must be open and in good standing to receive a bonus. To qualify, debit card transactions must have settled and exclude ATM transactions. Please refer to the applicable Upgrade Visa® Debit Card Agreement and Disclosures for more information. Welcome bonus offers cannot be combined, substituted, or applied retroactively. The bonus will be applied to your Rewards Checking Plus account as a one-time payout credit within 60 days after meeting the conditions.
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Just make sure you aren’t opening new accounts that you can’t afford. Remember, on-time payments are more important than account mix so make that your priority.
Tip: Do you rent or pay utilities? Consider signing up for ExtraCredit to get those accounts listed as new tradelines on your credit report!
6. Maintain a 30% Credit Utilization Rate
Credit utilization ratio is the amount of credit you have available versus how much you’re using. If you regularly max out your credit card, your score can go down. Try to avoid using more than 30% of your available credit at any time. If you have a card with a $1,000 credit limit, for example, stop spending when you reach the $300 mark until you can pay down some of the balance.
Your credit utilization rate accounts for 30% of your credit score. If you need to use more credit, try asking for a limit increase to avoid messing up your ratio.
7. Create—and Stick to—a Budget
Budgeting helps you create a foundation for meeting your other New Year’s financial resolutions. Learn how to create a budget that’s realistic and that you can stick to every month. You might also want to sign up for financial tools that help you keep a good eye on your money and save on common fees. For example, Digit analyzes your spending habits and determines what will help you meet your savings goals, and Chime offers an online and mobile account that helps you gain faster access to direct deposits and save automatically, letting you do more within your budget.
8. Start Building Your Investment Portfolio
There’s never a bad time to build wealth for the future, and you don’t need to be a high roller to start investing. If you’ve never invested before and want to make this one of your New Year’s financial resolutions, you might consider trying the Acorns app.
You can start investing using Acorns with as little as $5. You can also sign up for a debit card with Acorns that lets you invest change when you shop. Acorns rounds up every purchase and deposits your change into your investment accounts.
9. Pay Down Debt
If you want to end the year with less debt than you started with, this is a great financial resolution to make. Make a plan to pay down debt:
List all your debts, including the balances and interest rates.
Consider applying for products that can help you pay debt down faster and cheaper, like a balance transfer card.
Incorporate your debt payment plan into your budget.
Resolve to stick to your plan and pay down as much debt during the year as possible.
10. Get a New Job
If you’re looking to make a career move to help you recover from financial stressors associated with COVID-19, or you simply want to earn more or have a more stable job for the future, getting a new job is another top financial resolution for any year. Get some information on steps for finding a new job, and use resources like ZipRecruiter or Monster to help you connect with employers that are seeking people with your skills.
Make 2022 Your Best Financial Year Yet
Want to know a bit more about where your credit stands before you start making big resolutions and plans? Sign up for Credit.com’s free Credit Report Card. It provides a grade for you for each of the five major credit scoring factors. You can use those grades to target your financial resolutions to areas of credit or money management where you may need some additional work.
Chime is a financial technology company, not a bank. Banking services provided by The Bancorp Bank or Stride Bank, N.A.; Members FDIC
1The Annual Percentage Yield (“APY”) for the Chime Savings Account is variable and may change at any time. The disclosed APY is effective as of December 1, 2021. No minimum balance required. Must have $0.01 in savings to earn interest. Chime Checking Account is required to be eligible for a Savings Account. Banking services provided by The Bancorp Bank or Stride Bank, N.A.; Members FDIC.
2 The average national savings account interest rate of 0.06% is determined by FDIC as of November 15, 2021 based on a simple average of rates paid (uses annual percentage yield) by all insured depository institutions and branches for which data are available. Visit https://www.fdic.gov/regulations/resources/rates/ to learn more.
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