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Here are some ways to reorganize your finances without cutting everything out

You should lead with your head, not emotions

2020 has brought many of us to a reckoning with our spending habits. But there are plenty of ways to reorganize our finances without cutting everything out of our lives.

The Motley Fool’s Dana George says you should lead with your head, not emotions. It may be nice to order new subscription boxes or streaming services, but you should make sure you are getting the full value out of it first. She says 2020 has made many of us fear the unknown, and how it could affect our bank accounts. George says that we should all focus on creating an emergency fund just in case another difficult situation arises in the future.

The Personal Finance Company’s Elizabeth Aldrich says a goal in the new year is to overhaul your budget. 2020 caused many of our spending habits to change. That could include ordering more food to-go or more online purchases, which may be harder to track. Aldrich says we should all start tracking what we spend -- every purchase -- so we can be more informed of our new habits. She says that spending should be centered on values, so you can put money toward the things you truly want in life instead of things that are unnecessary.

The Motley Fool’s Maurie Backman says we should all spend more mindfully. That means taking out those impulse buys throughout the year. She says that being more deliberate with your money can not only help stabilize your financial situation in a wildly unstable year, but it can also help you plan for bigger events and expenses in the future.

Finally, they all say many of us are happy 2020 is coming to a close. But in order to make 2021 better, putting in a little work around the new year on your personal finances can make all the difference.


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