By Mark Muckenfuss

Cal State Monterey Bay’s Subhra Saha has three main pieces of financial advice for the coming year: assess your situation realistically, prioritize your spending and always have a backup plan.

And, he adds, don’t be too hard on yourself.

“Give yourself some grace,” he said. “Allow yourself to fail, but fail while trying. If a goal is not met, what you do then will determine your success. The issue is commitment.”

Saha, who has a doctorate in economics from The Ohio State University, has been with CSUMB’s College of Business for nine years. He said a good starting point for taking better control of your finances is to first look at what you’ve done.

“Reflect on what are or were your financial victories in 2023 and what were your financial anxieties,” he said. “What are the things that keep you up at night?”

It’s those things that deserve priority, he said. Once you’ve identified them, which may not take much time, a good warmup exercise is to evaluate your current situation. 

“What dollars come in, and which activities are responsible for money going out?” he said. 

Determine if there are ways to modify those amounts.

“Ask yourself, do I really need to spend my money on this? Is there somewhere else I could use time and money?” he said. “The idea is to give yourself space, so you can work around it, so you don’t feel backed into a corner. Think about the fact that you have a choice in the matter.”

Very often people struggling with finances are faced with credit card debt. Saha said he knows from personal experience how easy it can be to rack up such debt.

“I come from a really poor family in India,” Saha said. “When I first came to the U.S. and got a credit card, I couldn’t stop spending.”

He recommends not spending more than 10% of your credit limit on a card, and avoiding taking out credit card loans.

“Credit loans are like fire,” he said. “They can burn you to death.”

If credit card debt is swallowing your income, seek out a credit counselor, he said. 

Once you’ve assessed your financial situation and set your spending priorities, Saha said, establish a backup plan.

“Have a Plan B,” he said. “If I lose my job, do I have an emergency fund? Planning doesn’t guarantee success, but it helps mitigate shocks.”

Looking at the flip side, if your finances are in good order and you have extra money on hand, investing it can be a good move, Saha said. 

“Talking to a financial advisor is probably the best option,” he said. “The first meeting is usually free.”

If the stock market looks like a good option, he said, “Open a brokerage account, many are free.”

And, he adds, play the long game. 

Short-term gains are risky,” he said. “Think about putting money in index funds. Think about becoming a long-term investor.”

That, in itself, can provide a good Plan B.