In honor of Passover, the eight-day Jewish holiday that commemorates the Biblical story of the Exodus from Egypt, we’ve found plenty of lessons to glean for our everyday financial lives. The holiday’s alternate moniker, “Festival of Freedom,” reminds us to take stock of where we are—and where we’re going.
What old money habits are holding us back? Where do we struggle to gain control in our lives, and how does money affect our progress on those goals?
To help you free yourself from these old mindsets—and because it’s a great pun—we bring you some of the top financial tasks not to “pass over” this year. (And yes, we know the Israelite houses wanted to be passed over in the Exodus story, but we’re taking some poetic license to prove a grander point.)
1. Identifying Your ‘Shiny Objects’
It can be easy to overindulge when you aren’t keeping close tabs on your spending. Now may be the time to hit the reset button, revisit your budget (or create one!) and identify what’s distracting you from staying on target.
Minding your budget is a great way to help keep “shiny objects” from holding your money captive, says Jeff Gorton, a Certified Public Accountant, Certified Financial Planner™ and Investment Adviser Representative under Alphastar Capital Management. We all have our own money kryptonite—the one thing so tempting we just can’t avoid shelling out for it. Whether it’s your addiction to cute baby clothes or happy-hour specials, find out where you’re overspending.
Got better things to do than pore over old receipts all afternoon? For an easy, all-in-one way to track your expenses and break down how much you’re allocating to each category like entertainment or groceries, try the LearnVest Money Center or the LearnVest iPhone app. And make sure to account for those variable expenses that can sneak up on you (ahem, like those extra taxis you took last month).
How often? Every day. Even five minutes spent reviewing your purchases can keep you on track—and help make a big impact on your bottom line.
2. Factoring in a New Goal or Challenge
To break old bad habits, think about what’s new with your money this year. Maybe you have a new goal (like saving for a down payment) or a particular challenge (your student loans have come due): That’s when it’s time to consider updating your budget and shifting your expectations.
And remember, your budget is fluid. Did you get a raise and want to hack away at your debt faster? Do you expect to spend a lot more on travel this year because your sister’s getting married out of state? “Have an honest review and update of your finances,” says Groton. Need help updating your financial plan to reflect these changes? Plug in your new goal in the Money Center and find out how long it’ll take you to save up.
How often? Once a month. Tackle this task before you’re surprised by any of your spending habits.