4 Money Trends Worth Following To Fix Your Finances In 2024

Bernadette Joy, Contributor Dec. 30, 2023 Forbes

The Federal Reserve recently opted to hold interest rates at the same level. They’ve sat at 5.25% to 5.5% since July, and there’s a question driving much debate among investors lately: How low will the Fed will cut rates next year?

We don’t know the answer. Rather than using time and energy trying to predict the future, you can advance your financial goals much farther by taking the necessary steps to prepare for what’s to come instead.

Here are four trends that grew in popularity in 2023. If you continue to follow them into the new year, they can help you stack more savings and move faster toward financial freedom.

1. Prioritize Paying Down High-Interest Credit Card Debt

The first step in fixing your finances faster in 2024 is understanding the impact of high-interest loans, particularly credit card debt. Credit card debt has grown to an all-time high at $1.03 trillion, compared to $806 billion prepandemic, according to the New York Federal Reserve .

The need to navigate inflation and higher interest rates is unlikely to end in 2024, and even if they were to cool down significantly, you’d be better prepared by reducing your dependency and balances on high interest credit cards. One financial goal everyone should have is to focus on getting to — and maintaining — $0 balances on credit cards as they continue to average at 27.8% interest rates currently.

2. Leverage AI To Expand Your Financial Vocabulary

AI was all the rage in 2023. I don’t recommend using AI tools such as ChatGPT for investing advice, which tends to be highly personalized. But I do think it’s a great tool to help understand or extrapolate key financial concepts that you might not have been able to learn before from other online resources. ChatGPT also can help you translate what you might have heard from a financial advisor or educator.

In teaching live classes on topics such as budgeting and investing, I often find learners are afraid to ask questions for fear of sounding uneducated, but there’s no judgment coming from an AI tool. Giving additional AI prompts like “explain it at fifth grade level” or “explain it in simpler terms” can help you translate any financial jargon that may give you anxiety when making money decisions.

3. Plan For Early Retirement Now, Not Later

Financial Independence, Retire Early or the FIRE movement continued to grow in popularity this year, thanks to the growing number of people looking for freedom outside of a traditional day job in a post Covid-19 world. A comfortable retirement may mean traveling or spending more time with family. Or it could mean you choose work you love to do, versus how much it pays. Regardless of the definition, 56% of Americans said they’re not on track to retire comfortably, according to a recent CNBC survey .

I personally reached a milestone of having $1.5 million saved up for retirement in 2023. This achievement was thanks to following the principles of the FIRE movement and shifting as much as I could in tax-advantaged accounts such as my 401(k) and IRAs. I also spent well below my earned income to save the difference. With interest rates not expected to decrease significantly in 2024, it’s a great time to jump on the FIRE bandwagon by taking advantage of higher ones and increasing your savings power.

4. Keep Challenging Societal Norms About Wealth

Lastly, the questioning of societal expectations about wealth dominated a lot of financial forums this year. Those ranged from the debate between renting and buying a home to the rise of quiet luxury , where we saw a noticeable shift away from brand name fashion to classic and simple aesthetics.

In particular, as you form your financial goals for the new year, take an extra step to ask yourself, “Is this what I really want? Or do I think I want this because that’s what I’m supposed to do?” It's crucial to scrutinize these norms to manage your personal finances according to your values, rather than accept traditional advice in what’s likely to be another unexpected year.

By Bernadette Joy, Contributor

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