It’s January 3 and that means that we are officially into 2011. I would like to take this opportunity to wish everyone the best of love, life, and luck, in 2011. I know that it is cliché to write about our resolutions and goals at this time of the year, but I would like to do it anyways. After all, my personal motto is…Why be different, when I can just be me.
Instead of making New Year’s Resolutions this year, I propose that we all make Financial Resolutions. New Year’s resolutions are usually so broad and general, that we may probably don’t achieve them. Then, we are left setting the exact same New Year’s Resolution the next year.
A resolution is always easier to achieve when we have a clear defined goal with a direct path to follow. Let’s throw out our general New Year’s resolutions, and all set at least one specific Financial Resolution for 2011.
It is great to say that we would like to earn more money in 2011, but that is a general goal. Ask yourself, how will I earn more money? What will I change in my life? We need to think about how we are going to find a solution, or a resolution, to our goal. As an example our goal could be to earn more income, and our resolution could be to go back to school and study marketing, or economics, or finance. When we set a goal, we also need to make a plan to achieve our goal After all, the solution is a part of our resolution.
A Financial Resolution could be as simple as saving 2% of your pay check every week. Or, it could be a more complex resolution, such as starting your own business.
What are your Financial Resolutions for 2011?
Here are my Financial Resolutions for 2011:
Goal: To pay off my credit card balance in full by August 31 without using my savings and without increasing my monthly expenses.
Resolution: I will set up a pre authorized payment from my bank account to my credit card on a biweekly basis. I will not use my credit card for the next 8 months until it is paid off in full by August 31. I don’t want to stop saving, and I don’t want to save less in order to pay off my credit card. I want my monthly expenses and savings to remain the same. To achieve this I will cut back some personal expenses such as eating out and buying clothes that I don’t need. I will allocate the extra money to my debt repayment.
Goal: To take a one week vacation to Portugal the last week in September.
Resolution: I will open a vacation savings account, and set up an automatic transfer on a biweekly basis to start saving money and keep it separate from my other savings. The first step will be to renew my passport. I will then have to research the cost of a trip to Portugal. If I know how much the trip will cost, then I will know how much I need to save on a biweekly basis. I know that the cost of living in Portugal is significantly lower than in other Western European countries such as Italy. This means that I will be able to stretch out my money, even with the Euro exchange versus the US Dollar.
Photo By Ben Sutherland