New Year Resolutions

Posted on January 17 2008

We always start off the New Year with good intentions – going strong and ready to take on the world – we forget that we need to start with small but steady steps and to make our “resolutions” achievable. I stopped making resolutions years ago and changed my focus on goals.

The first step to setting financial goals is to take a close look at our budget. If you don’t already have a budget now is the perfect time to sit down and set one up. The first step is to put down the fixed monthly expenses. This would include our house payment or rent / utilities / cell phone / cable / internet / loans / monthly credit card payments / food / gas / insurance, etc. If you don’t know what you are spending monthly or haven’t added it up lately take a close look at last month’s bills to see how much is really being spent. A couple of month’s ago I added up our food and gas receipts – I was still pretty much on track with the food budget but gas prices had really gone up – more than I had anticipated. Once the budget is set compare it to your monthly income – then look at how much extra you have per month and plan out any projects / big purchases / vacations – or extra’s you might be planning for the year. If you are like most American’s and living pay check to pay check this is also the best time to take a closer look at what can be cut from the budget.

A few items to look at that may be changed:

1. Internet service/ Know how much you are paying a month. Is this the best deal? Keep an eye out for other providers and what they have to offer.
2. Cell Phone/ Know when your contract expires. Know how much per month you are paying. Do you ever go over your minutes and pay extra? Is your plan the best for you and your situation? Again, keep an eye out for what other providers have to offer once your current contract expires you can make the move to the better plan.
3. Cable TV/ Look at what you are paying – do you have more than basic service? Can your service be down graded? This is a good place to save a bit if you are living pay check to pay check.
4. Eating out/ This is expensive – much more reasonable to eat at home.

The list goes on. Now is also the time to take a close look at your credit card statements. Take a close look at the APR you are being charged as well as the amount of your monthly finance charge. Many times the minimum monthly payment barely covers the monthly finance charges. So whenever possible try and make a higher payment per month then requested to help pay off the balance in a more timely manner.

Getting our finances under control can relieve so much stress and worry from our lives. This sets the pace for so many other good things. Wishing you a great 2008!