Many people's financial goals and spending habits have changed in recent years due to economic turmoil. However, one of the priorities for Americans has always been to try to save more money while paying off debt.
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As interest rates rise as the Federal Reserve fights soaring inflation, it's more important than ever for Americans to find ways to pay down debt while also boosting their savings accounts.
Here are Americans' top financial goals for 2024 and what you can do to make them happen.
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Americans' biggest financial goals for 2024
According to a survey of more than 1,000 Americans conducted by GOBankingRates, people's top financial goal is to save more money, with 25% of those surveyed listing this as their main priority. Selected. Her second priority for those surveyed was getting out of debt, with 23% of respondents choosing this.
Key highlights from the 2024 Survey of Americans' Economic Priorities include:
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The same survey last year revealed that 28% want to save more money in 2023 and 23% want to get out of debt. This means that your top financial goals remain the same.
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28% of people aged 35-44 want to be debt-free in 2024, compared to just 13% of 18-24s who have this as their main financial goal.
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26% of respondents age 65 and older wanted to save more money.
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27% of women made getting out of debt a top priority, while 17% of men made this their main goal.
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18% of respondents said making more money is their top financial goal for 2024, up from 23% last year.
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What do these goals say about your financial confidence?
Americans' Economic Priorities makes several important points about economic confidence heading into 2024 and beyond.
change is needed
Scott Lieberman, founder of Touchdown Money, said Americans will have to become more aggressive with their financial goals.
“To save more money and get out of debt in 2024, you'll need to go beyond the usual advice of cutting spending, increasing income, and setting goals,” Lieberman says. said.
Further awareness is important
“If your goal is to save more money and become debt-free in 2024, the best place to start is by increasing your awareness,” says Erika, attorney and personal finance expert, founder of Erika.com. Kullberg says. “Debt can be overwhelming, and it's easy to bury your head in the sand and forget about it. But the big problem with debt is that it's especially difficult to borrow money on a revolving basis, like a credit card without a fixed payment plan. If you're using credit, the longer you stay in debt, the more your debt can grow.
You need to be more aware of your financial goals and what steps you need to take to achieve them. Economic problems cannot be ignored because they will not go away on their own.
“The good news is that if your goal is to save more money and become debt-free in 2024, both of these goals work together,” Kullberg said. “The faster you pay off your debt, the less you'll pay in interest and the easier it will be to save more money.”
How can people achieve these financial goals?
We asked experts for advice on how to save money and pay off debt in 2024. Here's what Americans can do in 2024 to make their financial goals a reality.
Adopt a zero waste lifestyle
“You may have seen 'no spend' months on TikTok or Instagram, but these aren't just fads,” Lieberman says. “A zero-waste lifestyle, which means minimizing what you throw away, reusing and repurposing items, and avoiding single-use items, can help you save money and spend less. You'll have more money to save and pay off debt, and you might even find that it's fun.”
audit your spending
“Audit your spending on a monthly and yearly basis,” says Ganesh Pandit, professor and chair of Adelphi University's School of Accounting and Law. It's important to know where your money is going so you can determine what changes you need to make. Until you understand your spending problem areas, you won't know where to start.
“Check to see if you have any expenses, such as subscriptions, that you buy but don't actually use,” says Pandit. “For example, video streaming, prepared meals, entertainment apps, gym memberships, etc. If you're not using them, cancel your subscription immediately.”
Until you're debt-free, you should have some extra space in your monthly budget so you can put more money toward paying off your debts.
Build up an emergency fund
“You need to have an emergency fund so you can handle unexpected expenses without taking on high-interest debt like credit cards,” Kullberg says. “Once you have an emergency fund, it may be beneficial to stop focusing on actually saving money and instead focus on paying off debt.”
Mr. Kullberg further argued for debt repayment as follows:
“While you may want to save immediately for a big expense like a house or a wedding, focusing on paying off your debt first could help you save more in the end,” she says. I did.
Automate your savings
Simplify your financial life and think less by automating your savings.
“Set aside a certain percentage or a certain amount of money from your salary into a savings account for debt repayment,” Pandit said. “Instead of just saving 'some' money, make a plan to save a predetermined amount ($100 to $250) each pay period. Setting a number for the amount you plan to save each month will help you save money more consistently each period and build up your savings goal faster. ”
List your debts and understand your position
Before you get serious about paying off debt and saving more money, you need to know where you stand. You'll want to know exactly how much you owe so you can decide how much to allocate towards debt payments.
“Create a list of your debts that includes the outstanding principal balance, interest rate, monthly payment amount, payment due date, and other information,” Pandit said. “Compare this list to your most recent credit report to make sure you're not missing anything.”
Try consolidating your debts
“If you have multiple debts, try to consolidate them into fewer debts or one debt with a reputable lender who won't fool you with unexpected fees or charges,” says Pandit. Ta.
One common strategy for helping people pay off debt is to simplify their lives by consolidating their debt under one umbrella.
“Make sure the interest rate on your new consolidation loan does not exceed the average interest rate on your current debt,” Pandit warned. “Be careful not to leave yourself in debt for too long with a new consolidation loan, otherwise you will incur unnecessary interest costs. This way you can combine your debts into one new debt. Integration makes it easier to track a single payment.”
Try the debt avalanche method
“I'm a fan of the debt avalanche method for consumers who want to pay off their debt as quickly as possible,” Kullberg said. “With this method, you focus on paying off high-interest debt first and gradually work your way to lower-interest debt. Once you pay off your debt sources in full, you free up money that could have been put toward your monthly payments. You'll spend it on the next highest interest rate debt source. You'll progress very quickly this way and save a lot of money on interest payments.”
If you're not interested in this debt repayment plan, consider the following options.
Try Debt Snowball
“Rank your debts from lowest to highest balance and pay off the lowest balance first as a low-hanging fruit,” Pandit said. “Then tackle your next largest loan balance, and so on. When you know you're paying off your debt, you'll feel more confident and motivated to work harder to pay off the rest of your debt.” ”
This debt payoff strategy was made popular by financial guru Dave Ramsey, who encourages people to get quick wins and build momentum. Once you build momentum, you'll feel like you're in control of your money.
Rent what you own
If you have little time, you can take advantage of the gig economy to earn some extra cash from your current possessions. The extra money you earn this way can be used to build up an emergency fund or be proactive about paying down your debts.
“In addition to renting a room in your home or a car on Touro, consider renting out items you own but don't use often,” Lieberman says. “This includes things like tools, camping gear, and even clothing. Platforms like Fat Llama facilitate this type of rental and are a way to put items to good use and generate income that can be used to save or pay off debt. ”
Consider other side jobs
If saving more money and paying off debt is your main priority, you'll probably need to find ways to increase your income to speed up the process. For this reason, you can also consider other side jobs, such as walking dogs in Rover or offering freelance services. The topic of side hustles is worth a whole article, but a good place to start is to find out what options are nearby to find ways to make more money.
Get your family involved too
Saving money isn't always easy. It's important that those around you understand and support your goals for this year.
“Remember that saving money and paying off debt is a 'family project' where everyone in the family must be on the same page,” Pandit said.
If you're looking to save more money and pay off your debt in 2024, this article should give you the right tools to get started. It's important to have a realistic plan so that you find yourself in a completely different financial situation in 2025.
GOBankingRates Details
This article originally appeared on GOBankingRates.com: Here Are Americans' Top Financial Goals for the Next Year
