How Georgians can start 2012 on the right financial foot

When you made your new year’s resolutions, was “pay off my debt” or “save more money” anywhere on your list? If you’re like most Georgia residents, getting a better handle on your finances is on your to-do list for the coming year. Whether you have debt to pay or you are simply looking to save more, here are a few tips for making 2012 your best financial year.

If you want to pay off your debt, you should start by making a budget. Look at what you spend on food, housing and other necessities, and what you spend on extras. This will help you to identify and eliminate nonessentials, and funnel that money toward your debt.

Second, you should try to negotiate a lower interest rate on your credit cards and other bills. Many people are not aware that credit card companies are willing to lower your rates if you just call and ask. This will depend on your credit score and payment history, but in general, credit card companies don’t want to lose you as a customer so they may be willing to work with you.

Third, come up with a plan to tier your debts. If you are paying off multiple credit cards, pay the most on the card with the highest interest rate first. When that one is paid off, add that monthly payment amount to the card with the next lowest interest rate, and continue this until all of your cards are paid off. This will ensure that you are putting more toward principal and less toward interest.

If you do not have significant outstanding debt but want to save more money, you should also make calls to your bill vendors and ask for better rates. In addition, this may be a good time to increase your 401(k) contribution.

Source: Atlanta Journal-Constitution, “It’s not too late to cut, save,” Lauren Davidson, Jan. 2, 2012