The year 2022 is coming to a close and 2023 is just days away. The turn of the calendar from one year to another is a prime time to step back for a moment of reflection, as it provides a natural end to one thing and a beginning to the next. As 2022 comes to a close, here are six things you can do to help you start 2023 off on the right foot.
Update Your Net Worth
Take some time to update your net worth. How do you do that? Write out everything you own—bank accounts, investments, your house. We don’t usually include cars and personal property that goes down in value. After you’ve listed out everything you own, list out what you owe. This includes any debt you have, such as a mortgage, student loan, auto loan, or personal loan. Total each section and subtract what you owe from what you own. That is your net worth.
We recommend that people update their net worth at least once a year (we do it twice a year with our ongoing clients). It’s helpful to do it in a spreadsheet where you can add a new column for each year so that you can see how it changes over time. We do this because net worth is a good measurement of your stewardship. It shows how you’re doing at turning your income into long-term wealth. Also, it reminds you what you have and elicits gratitude for all that God has blessed you with and entrusted to your care.
Review Your Budget
The start of a new year is also a great time to review your budget. If you don’t have one, take it as an opportunity to make one with a clean start with a new calendar year. This article walks you through how to make a budget.
To review your budget, start by looking backward to see how your spending aligned with your plans in 2022. Is there anything that didn’t turn out to be realistic that you need to adjust for 2023? You will also need to update it with any new pay raises or changes to your paycheck withholding for savings or employee benefits.
We believe that your cash flow should align with your values. What are your goals for 2023? Are you making any New Year’s resolutions that need to be reflected in your budget? Make your budget future-focused, so that it empowers you to create the life that you want to have instead of simply maintaining your current situation.
Finish Your Year-End Giving
At Guide Financial Planning, we don’t believe financial planning is only about wealth building. We want you to be generous and support organizations you’re passionate about as well. Generosity should flow naturally from a grateful heart, but here in the United States, you can also get tax benefits for your generosity. Tax benefits for charitable giving are based on the calendar year, so if you want to get any tax benefits, you need to get your gifts in now. If you don’t give quite enough to justify itemizing your deductions on an annual basis, you may benefit from utilizing a bunching strategy, as explained here.
Review and Set Goals
The turn of the calendar year is a common time for goals to come to mind. As with budgeting, before you start thinking about goals for 2023, it’s important to review any goals that you set for 2022. Evaluate how you did on accomplishing last year’s goals. Don’t just ask yourself if you did it or not. If you did, what made it possible? What did you do right? How did you set yourself up for success? If you weren’t able to accomplish your goals, why not? What could you have done differently? Was it the goal itself that was the problem? Sometimes, the way we state a goal can set us up for failure from the beginning. If you aren’t familiar with SMART goals, consider watching this video and using it as a model for setting your 2023 goals. Armed with the insight you gained from evaluating your 2022 goals, go ahead and set some SMART goals for 2023!
Remember Who is in Control
It’s a good practice to plan for your finances and set goals, but the truth is that we don’t always know what the future holds. Infamous 2020 should have taught us all that very well. The important thing to remember is that we know who holds the future. We should strive to keep a proper perspective that our finances, our health, and our ability to set and pursue goals are all a gift from God that we should not take for granted. Recognize that He is in control and owns it all, and honor him for it. Entering 2023 with that perspective will set you up for success, no matter what comes your way.
Seek Professional Help
If one of your SMART goals for 2023 is to get a better grasp on your finances or develop a plan, we can help. Our services range from one-time engagements to ongoing relationships and comprehensive plans to targeted advice. To learn more about how we may be able to partner together to help you achieve your 2023 goals, schedule a free introductory call today.
About Guide Financial Planning
Guide Financial Planning is led by founder Ben Wacek, who is a Christian fee-only Certified Financial Planner™ and Certified Kingdom Advisor®. He has a passion to help people of all income levels make wise financial decisions and steward their resources from an eternal perspective using Biblical principles. Based in Minneapolis, MN, he works with clients both locally and virtually throughout the country and abroad. You can follow the links to learn more about Guide Financial Planning and our team and the services we offer.