What the Year of the Horse could symbolize for your finances

Many people have quit their New Year’s resolutions by now, with the infamous “Quitter’s Day” taking place around the second Friday of every January.

If you have already given up on your New Year’s resolutions but were hoping to get your finances more on track this year, maybe the motivation you need could be inspired by the start of the Chinese Lunar New Year last week, as we move into the Year of the Horse. 

In its tradition, the horse represents action, breakthrough, and freedom. It represents boldly moving into an aligned future. This promise applied to finances sounds tantalizing, but let’s look at how financial freedom can be achieved through the first symbol of the horse: action. 

As financial advisers, we know how tempting it can be for clients to bury their heads in the sand when it comes to their finances. But getting where you want to be starts with taking an honest look at where you are. 

Step one

The first step to any good financial plan? Evaluate your finances and get a good idea of what you’re bringing in versus what you’re spending. This will give you a better idea of where you spend the most and where you might be able to cut back — and it might give you the mental breakthrough you need. 

Step two

Outline your financial goals: Do you want to save more? Do you want to start investing or planning for retirement? Set concrete goals for yourself and break down larger goals into smaller ones to make them easier to accomplish. For example, instead of saying “I want to save more money,” set specific goals, such as, “I will save $5,000 by Dec. 31, 2026.” You could break this down further by analyzing how much you can afford to put aside and how often you can afford to do so toward this $5,000. 

Step three

Budget your money and allocate it for needs, wants, debt and savings. Calculate how much of your paycheck must go toward your basic needs, then set money aside for your savings, your debt and even for your wants (you deserve the freedom of spending some money on yourself). A basic method is the 50/30/20 rule: allocate 50% of your income to needs, 30% to wants and 20% to savings. When it comes to tackling debt, remember to pay off high-interest debt first. 

Step four

Invest in your future freedom. Whether you’re saving for retirement or emergencies, putting money aside now is important in setting yourself up for a successful future. Work with a financial adviser or check out Bank of America’s “Better Money Habits” website to learn more about retirement planning or even stock investments. 

This Year of the Horse, we wish you a fortuitous transformation in your financial life. Achieving your goals is more than possible, and sometimes it takes making a bold change. A lot of the time, it just means taking the first step.

Edgar Velazquez is the New Mexico consumer site leader for Bank of America, where he has worked since 2003. Executive’s Desk is a guest column providing advice, commentary or information about resources available to the business community in New Mexico. To submit a column for consideration, email mnarvaiz@abqjournal.com.