Making financial resolutions over the common ones will have their merits this New Year eve. As it goes, it has been found that those who resolved to save more this year had more success than those who took a resolution to cut down smoking. Money resolutions, undoubtedly, have a tendency to stick in mind more strongly because that’s what affects our lifestyle on a more close and daily basis. Here are such 10 resolutions that you can make to improve your financial standing this year.
Making and living by a budget is very important to make sure you are not living a life on credit. This year, make yourself live through your planned budget and follow it strictly. Keep an eye on your bank statements and also consider your yearly CIBIL credit report; it will tell you where you stand financially and what you need to improve it.
- Save extra for crisis funds: According to various financial advisors, a person should have an emergency fund comprised of his, at least, 3 months’ paychecks. This is very important as you do not know when a medical condition may develop which will require immediate disposal of funds or any other such emergency. If you have achieved this goal already, then save more because more is always better. But if you are facing difficulty in saving, then it’s time for desperate measures. Treat yourself as there is indeed an emergency and you cannot do without a particular sum each month. Be it INR 1,500 or INR 15,000, put aside a sum as your salary allows into a crisis fund, and do not touch it ever.
- Clearing off the debts: Promise yourself that however difficult it may seem, you will pay off all the debts. Start with the debts that have higher interest and, thus, are eating off money like a green-eating monster. Also, pay always more than the minimum requirement on your credit card. Generate cash to pay the creditors in advance and save some money.
- The mantra of budgeting: Making and living by a budget is very important to make sure you are not living a life on credit. This year, make yourself live through your planned budget and follow it strictly. Keep an eye on your bank statements and also consider your yearly CIBIL credit report; it will tell you where you stand financially and what you need to improve it.
- More cash inflows: The golden rule which is stressed upon by the experts again and again, try to create more cash incoming than just your regular job. No, you don’t need to acquire one more degree to earn cash, just use up your existing talent and skills to earn more. For example, if you are a software developer, then apart from your job, offer your assistance on an online platform like WorknHire.com, Freelancers.com. Make your hobbies your extra source of income.
- Invest money: If you too are one of those fellows whose money is sitting idle in a bank account, then take it out and invest. If you are a finance knowing chap, then study the market to know about the profitable SIP mutual funds and stocks, otherwise you can take help from an investment planner. Ask your bank for any such services offered as many banks do. Then start putting aside a certain sum each month just for the purpose of investing. You can invest your money in tax saving retirement plans or in mutual funds; identify your needs and do not forget to compare the returns online.
- Include your family in the financial planning: This one is still a rare thing among the Indian families as in most cases, only the male head of the family knows what comes in and what goes out, the rest of the family members neither know anything nor do they bother. Talk to your spouse and children about your debts, insurance policies, mortgages and other financial matters in a monthly finance meeting. It will help them to understand the finances better and their role in the better planning and management of funds. Likewise, ask them about their opinions and encourage them to think of new ways of saving money.
- Cut the unnecessary expenses: How many of you promise to not spend less every year? That resolution when flies out of the window, even you do not know. Make it a little more specific instead. Promise yourself to cut on the monthly going-out meals, or on your utility bills. There are various small ways you can bring your daily costs down, be it food, electricity bills, water bills or late payment charges.
- Learn the art of organizing: Keep your insurance papers, mortgage agreements, tax returns in one place where you can access them easily whenever you want. Keeping everything tidy and organized will help you avoid the missed payments and other late fees due to carelessness. There are various apps you can download which keep you on the right financial track such as Mint.
- Enhance your financial skills: You have a Master’s degree which earned you a job, but now what? Learning does not stop with age, teach yourself every day. If you are paying someone to file your tax returns, learn to do it yourself. Read the financial newspapers daily and learn more about the investments and savings.
- Be tech savvy: Have you been paying your monthly loan installments or utility bills in cash? This is the right time to learn some computer skills to do the same from your home or office and save time and energy.