It may seem a bit early to be thinking about financial goals for 2023 considering Christmas hasn’t even passed yet. But Bank of America just released a consumer survey about holiday shopping and financial New Year’s resolutions, which got me thinking about my goals.
According to Bank of America, the top financial New Year’s resolution is to increase savings, followed by investing for retirement. Americans also want to travel, build an emergency fund, pay off debt, purchase a home or car, and save for their children’s education.
In 2023, I mainly want to focus on paying off my mortgage, saving for a car, and increasing my retirement contributions. I also want to keep working on my financial mindset and building a healthy relationship with money. Here’s a more in-depth overview of my financial New Year’s resolutions.
Continue Paying Off My Home
Right now my spouse and I are working on aggressively paying off our home. On average, we make a mortgage overpayment of about $2,000 every month. So far we’ve reduced our mortgage balance from around $180,000 to $150,000. Overpaying our mortgage is definitely something we plan to continue doing in 2023.
The goal I’m setting for 2023 is paying off at least $20,000 of mortgage principal. I think this is an achievable goal that gives us some wiggle room in case we can’t make a mortgage overpayment for a month or two. Long-term, we’re hoping to have the house paid off in about 5 years, but we’ll see how things go!
Keep Saving for a Car
Like most Americans, I want to keep saving money in 2023. My spouse and I worked on our emergency fund in 2022, which is now fully funded. So we’re turning our focus to our car fund to ensure we don’t have to get a car loan when we need to replace our Ford Fiesta.
Right now our car has about 140,000 miles on it and has started needing more extensive repairs lately. In the past few months, we’ve spent close to $2,000 on repairs. At some point, it will make more financial sense to get another vehicle than keep pouring money into our hatchback. We’re not sure if we’re going to get a new or used car. We’re also looking into hybrids and fully electric vehicles.
My spouse drives a lot for work, and we get a lot of snow in the winter. Since I want us to be able to afford a safe, reliable vehicle without getting a car loan, I’m thinking we need to save between $25,000 and $30,000 for a car. We have a little under $5,000 in our car fund, so we really need to make headway toward our goal this year.
I want to contribute at least $800 per month toward this goal, but would be happier if we could set aside $1,000 per month or more. We’ve both been doing well at work and my spouse has been getting some nice bonuses, so hopefully that will help accelerate our progress.
Increase Our Retirement Contributions
My spouse is up for a promotion in 2023, which would likely come with a decent raise. We’re planning to direct some of that money toward our retirement accounts. With our current savings rate, we’re on track to have 70% of our current income in retirement. But medical expenses like long-term care aren’t getting any cheaper, so I want to make sure we have enough money to cover our health needs.
In 2023, I’m hoping we can up our contributions by at least 5%. Right now we’re mainly using my spouse’s 401k to save for retirement, so I’m thinking about opening up a Roth IRA for myself as well.
Work on My Money Mindset
This year, I worked with a therapist to try to improve my money mindset. Because of the looming recession and long-term stress of inflation, my financial anxiety reared its head again in 2022. I thought I had pretty much overcome my financial worries, but all the economic uncertainty we’ve been dealing with for the past two years caused it to resurface.
Although therapy has helped a lot, I still think I have work to do when it comes to my money mindset. I’m a saver who’s very focused on the future and long-term financial health. As a result, spending money tends to stress me out. So in 2023, I want to continue working on my spending guilt with my therapist and hopefully achieve greater financial balance. I still want to do plenty of saving, but also enjoy life more and maybe do some traveling or go to a few concerts. I want to make sure my spouse and I have lots of great memories from our 20s, so I’m going to work on letting my hair down a bit more in 2023.
What are your financial resolutions for 2023? I’d love to hear about your goals in the comments section below!
Vicky Monroe is a freelance personal finance and lifestyle writer. When she’s not busy writing about her favorite money saving hacks or tinkering with her budget spreadsheets, she likes to travel, garden, and cook healthy vegetarian meals.