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The New Year brings new opportunities. As you look toward the future with your friends and family, this is also the perfect time to look at your finances and prepare for what’s ahead.

Here are some suggestions for taking your money further as we enter the following year. This is by no means an exhaustive list. Nevertheless, they can serve as helpful next steps as you exit the holidays and set the pace for 2024.

Take Account of Your Savings

Let’s address the elephant in the room right now: the winter holidays can take a toll on your finances, no matter how prepared you may be. Just as it makes sense to revise your budget periodically, now is a great time to look at your savings.

You should get a jump start in replenishing your emergency or sinking funds. Determine what you will need to cover an emergency or upcoming cost, and prioritize that as a savings goal going into the year.

Always make saving a habit! Paying yourself first and regularly does add up, and it can make a difference if you’re confronted with a surprise expense.

Redeem Credit Card Rewards

Did you use your credit or debit card frequently this past year? If so, verify if the cards you used are part of a rewards program. Your accounts might have accrued points you can redeem for cash back, travel credit, and other goods and services that will help save on your expenses.

Rewards programs and their requirements vary according to the servicer, but generally speaking, every dollar spent from an eligible account will accumulate points that are redeemable through an online platform. Some servicers may even award extra points if charges went towards specific categories, like travel, gas, and groceries.

Now is an excellent time to check on the status of your rewards to see if you can score some extra savings—or even plan for a vacation. Again, rewards programs will vary, but in general, points are redeemable for:

• Cash Back: Convert points into honest-to-goodness money! Choosing cash back allows you to receive money in the form of a check or a deposit to your account. This is a sensible option if you wish to replenish your emergency fund or save for an expense.
• Credit Reimbursement: It may be possible to convert points into a payment towards your outstanding balance. This is a handy option if you’ve recently had to charge for something unexpected or feel like treating yourself or someone you know.
• Travel: Some rewards programs have a dedicated platform for booking trips through points. These points will allow you to pay for travel fares, hotels, and vehicle rentals. This is a great place to start if you have travel plans for next year.
• Online Shopping: Many rewards programs have their version of an online store where you can exchange points for products, gift cards, and even discounts on services. Do you need to replace some tools or get a head start on gift shopping? Let your points cover portions of the bill.

Remember: not all reward programs are identical. Depending on the card, the exchange rate for your points may favor one redemption method over the other. For instance, one of your cards might have a lower points threshold to book travel, while another will make it more valuable to opt for cashback. Refer to your card’s disclosure statement or contact your servicer to verify the conditions attached to your rewards.

Consolidate Your Debt

The year’s expenses might have caused you to take out more lines of credit or a loan. Different accounts might have different interest rates, leading to higher total costs when you settle a balance. You might have an avenue to pay less interest by consolidating your debt.

There are several ways to do this. First, if you have multiple credit cards, you can transfer a credit card balance from a higher-interest account to one with a lower interest rate. Doing so may lower your monthly payments or decrease the total amount you’d pay on your outstanding balance.

Another option is to take out a loan to pay off outstanding balances and then pay off that loan. Products like home equity lines of credit or personal loans might have lower interest rates than most credit cards. If your primary concern is paying too much interest, consolidating your debt into a loan with lower interest might be a sensible option.

We get it: taking out a loan to repay another loan sounds counterintuitive. That’s why it’s important to compare interest rates and have the correct information before you make this decision. If you’re considering consolidating your debt, speaking with a financial professional to discuss your options is highly recommended.

Recalibrate Your Goals With a Financial Advisor

Your finances are a snapshot of how you did last year and what to expect. The start of the year is a good opportunity to discuss your goals with a qualified financial professional.

A certified financial professional provides perspective on how to view your money. Maybe you received a bonus from work or a substantial gift from a relative and aren’t sure what to do with the windfall. Or, there have been changes to your professional outlook, and you need insights into how to plan for the future. Perhaps you are considering consolidating your debt.

When looking for a financial advisor, ensuring they are well-qualified and committed to prioritizing your interests is important. Look for a professional who has credentials from recognized organizations. A qualified professional will have a title that can be verified against a professional database. Titles to look out for include:

• CFP®: Certified Financial Planner™
• ChFC®: Chartered Financial Consultant™
• RFC®: Registered Financial Consultant™

Financial advisors can have different approaches to addressing client needs. Therefore, it is important to have your goals in mind and then find a compatible professional. An experienced professional will also recognize this and take the time to point you in the right direction.

Remember: First Florida Credit Union provides a wealth of resources to help you start the next year with confidence. Explore our website to learn more about our various savings products, or visit your local branch to discuss your financial goals.