5 Tips to Improve Your Finances in 2013

This year was difficult for many adults of all ages and demographics. Foreclosures were elevated, the unemployment rate remained high and a large number of people reported significant student loan and credit card debt. This does not mean that people are willing to let these scenarios hold them back from improving their finances in 2013, and many have already expressed optimism over next year’s goals.

Data from a recent CouponCabin survey shows that 52 percent of respondents said they believe their finances will see an improvement next year, compared with 48 percent of people who gave the same answer last year. Another 39 percent said they plan to overhaul their money management tactics to ensure that their finances are stronger in 2013.

According to the results, 27 percent said they will build an emergency fund to protect them in the event of unexpected expenses. Many people find themselves forced to drain their hard-earned savings or retirement accounts when a car repair or medical bill threatens their finances. Another 18 percent of consumers said they will prioritize their retirement nest eggs to make sure they don’t fall short during their golden years. Others plan on ensuring their children are adequately cared for, with 14 percent saying they will increase their savings for their kids’ tuition and college expenses.

Follow these tips to make sure your finances stay on track next year:

1) Always remember that credit is a loan. It’s real money that you must repay.

2) Go slowly. Get one card with a low limit and use it responsibly before you even consider getting another.

3) Always pay on time. A single slip-up may place a black mark on your credit record — and can cause your issuer to jack up your interest rate to the maximum.

4) Set a budget, follow it faithfully and watch how much you’re paying on credit. A good rule of thumb is to keep your debt payments less than 15 percent of your net income after taxes. So if you take home $2,000 a month, spend no more than $300 a month on credit.

5) At the first sign of credit danger, such as using one card to pay off another, make the card harder to use. Only carry it when you plan to use it, otherwise, lock it up in an inaccessible place.