How to make a good finance to start 2023 on the right foot?

It is usual that, with the end of the year, companies take stock of the state of their finances with the aim of having a better 2023. However, this good practice should not be exclusive to companies: individuals and families can also carry out this exercise to know how they end the year and what may be the best decisions they can make for the immediate future.

This is particularly important in a scenario as volatile as the current one, in which uncertainty has grown due to the war in Ukraine, the increase in fuel prices, rumors of recession, among other factors.

These trends demand to be more careful with our personal finances. A great strategy to achieve this task is to make a balance at the end of the year that allows answering questions such as what income we have had, what unforeseen events there have been  or if the goals projected at the beginning of the year have been met, etc.

This will allow you to know if it has been adjusted to the budget or if, on the contrary, we have been living above our economic capacity. It also makes it possible to identify what mistakes were made and what measures need to be taken to make next year better.

Steps to take stock in the new year

1. Identify income: The first step is to identify where our money comes from, including salaries, investments or passive income such as property rental tents.
2. Identify expenses: The second step involves reviewing where our money is going. This includes mortgages, rents, as well as expenses on food, public and private services, education, fun or leisure, among others.
3. Correct the negative balance: if this shows that there have been more expenses than income, it is necessary to reduce expenses in some way (for example, opting for  cheaper alternatives in services or eliminating somenon-essential ones). Another option is to look for additional sources of income, such as a part-time job, if possible.
4. Enhance the positive balance: if, on the contrary, the result of the previous year was positive, it is ideal not to rest on the laurals. Generating savings and looking for investment possibilities can be a great alternative if, at the end of the day, your numbers are in the green. The key here is to invest correctly according to your characteristics. If, for example, your profit margin is large, it will be possible to look for investments with higher risk, but more lucrative. On the contrary, it is advisable to start with stable investments that provide moderate, but safe returns.
5. Set goals for the following year: based on all of the above, this good habit should be closed by setting goals for 2023. Now, it is not a matter of simply drawing up some achievements and seeing if in December of the following year these were fulfilled or not. The important thing is to monitor these goals, see if they are being achieved or if, on the contrary, it is necessary to make adjustments in the monthly planning. In this way, it will be possible to rectify in time or even set more ambitious goals if your situation is better than expected.
6. Professionalize in this area: if definitely having a more organized life in the financial is your passion, we recommend you take the MBA at BIU University, where you can professionalize this aspect of your life in a program that will give you the necessary tools to run all types of companies. For more information visit https://www.biu.us/administracion-de-empresas/.