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Do these 3 things this holiday season to give your money a boost in 2020

Tristan Harrison
Businessman paying Australian money

This time of year is a great time to reflect on the year that has happened and what can happen in 2020.

The leadership at National Australia Bank Ltd (ASX: NAB) and Westpac Banking Corp (ASX: WBC) probably won’t have the most relaxing Christmas of their lives, hopefully you can look back on 2019 with pride on your financial 2019 year.

Here are three things you should do this holiday season:

Financially review how the year went

It’s hard to know if you’ve done well financially unless you actually review how things went.

There are two elements that I think you should look at, your investment performance and personal finances.

Investment performance

Your investment performance is one of the main things that will decide your living in retirement and perhaps influence your mood. The more you control your emotions and expectations, the more likely you’re be able to make the right long-term decision.

If 2019 was a year of strong performance for you, then great. You should stick with good businesses or good investments (like quality ETFs) for the long-term including through upcoming volatility.

If this year has been a bad year for you then you should be realistic about why it was bad. Were you chasing really speculative shares that weren’t going to work out? It might be a good idea to leave those types of ideas behind. Maybe you were just unlucky and your share will bounce back – you just need to be patient.

Personal finances

You don’t need to analyse every dollar spent, but I think it’s important to have a good grasp of generally where your money went and how much you saved.

You probably have some sort of long-term financial goals. It’s hard to reach your goals if you’re not aware of how much you’re spending or how well you’re tracking towards your goals.

Make and stick with your budget

A budget is your roadmap, your blueprint, your plan for your money. You wouldn’t build a house without a plan.

There are plenty of budgeting apps out there that can help. I think it’s best when you set a budget that isn’t too strict – budgeting in “fun” means you’re less likely to go off-course. I think it’s also a good idea to budget a little more than you normally spend on some categories because life doesn’t always go to plan – we need a bit of leeway. Of course, you can aim to beat that budgeted number for each category.

But whatever you decide you have to stick with it on average over the course of the year. A budget is only useful if you follow it, otherwise it’s just a bit of financial fun.

Zip Co Ltd’s (ASX: Z1P) Pocketbook is one of the most popular free tools out there.

Make a commitment to follow your 2020 investment plan

Investing is something that should be done with as little emotion as possible. We can’t let what the market or economy is doing to significantly influence our investment plan in 2020.

If you have a plan to invest $1,000 a month then you should stick with it into your chosen growth share, exchange-traded fund (ETF) or listed investment company (LIC).

I strongly believe that 2020 could see volatility return again, so whilst things are calm I think it’s important to affirm to yourself that you will continue invest when there are opportunities, even if things look a bit rough.

The post Do these 3 things this holiday season to give your money a boost in 2020 appeared first on Motley Fool Australia.

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Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia owns shares of National Australia Bank Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2019