There could not be a better time to mull over the changes needed in our lifestyles than at the beginning of a New Year. This is also a good time to set yearly goals and make resolutions. Each year, according to statistics, almost a third of us make some kinds of New Year Resolutions. Interestingly, although financial future is our main cause of anxiety, our personal finance, according to surveys, gets only to the fifth place in the list of most common New Year resolutions.
For those of us who are still in the process of making New Year resolutions, my suggestion is to give high priority to financial aspects.
Here are some resolution ideas that may change your financial future over the course of time.
Saving
Let's make one thing clear! Whatever amount of money you make is probably never enough! The way our consumer psychology works is our demand increases along with our income. This makes saving really a problematic task! Some people do have inborn ability to save willingly, but most have to force themselves. If you are one of these people who find saving a difficult thing, you should consider the methods described below.
• Commit to yourself that each month you will set aside minimum ten percent of your income for investment purposes.
• Make a strict habit of depositing 10 percent of all your income directly to your saving account.
• No matter what happens, don't give up.
You might argue that your income is not enough to make any kind of savings. Believe me, once you try putting away 10 percent of your earnings, you will see that this really does not have any serious impact on your budget.
So your first resolution is to save ten percent of all your income month after month.
There is hardly any point to save if you don't put your money to work for yourself! So, once you resolved to save, you need to invest your money wisely.
Credit Cards and Other Consumer Loans
According to New York Times, throughout the last decade use of credit cards has increased dramatically. The number of the people with credit cards raised about 75 percent from 82 million in 1990 to 144 million in 2003. However, the debt burden that they carry had grown 350 percent from $338 billion to an astounding $1.5 trillion. In 2003, according to the same report, average household carried a debt of $7,520 in comparison to $2,550 in 1990.
This means that credit card loans are becoming serious problems for average Joe. That's why the first step of your investment strategy should be to get rid of your consumer debts- especially your credit card loans. Most credit cards have horrendously expensive interest rates -- normally, 18 percent and over. If you are one of those people who pay only minimum payment amount each month to their credit cards' debt, you are making a great mistake. Check out the calculator at http://www.bankrate.com/brm/calc/MinPayment.asp to see how much you are losing by not eliminating your credit card debt burden.
If you are looking for financially sound future, take a hard look at your credit cards and resolve to do the following:
From the savings you started to make, pay off the maximum amount of your credit cards' debts until you completely eliminate them.
• If you are unable to pay off the whole amount at once, don't just pay the minimum amount required; pay out as much as you can over that limit.
• Shop for credit cards with minimum interest rates -- which should not be more than 12 percent -- and switch to them.
• Use credit cards strictly for convenience only. Don't charge to your credit cards unless you know for sure that you will be able to pay it off right away.
• Minimize the quantity of credit cards you are holding. There is no reason to have more than three credit cards.
Same goes for your other consumer loans like student, car, etc.
Mortgage
The second step of your investment strategy should be to evaluate your mortgage payments. There are several very simple ways of reducing your payment time dramatically. Used scrupulously these methods can lower a 30-year mortgage to 10-15 years.
• Instead of making one single payment each month, every two weeks' pay out half the monthly payment. The idea behind this is, since you are making 26 payments in a year -- each one of them carrying 50 percent of your monthly payment -- this is equivalent to 13 monthly payments. You are generating an extra month's payment each year, which in turn will reduce your mortgage term substantially.
• Whenever possible, each month try paying ten percent more than you are supposed to.
• Whenever you manage to make some extra earnings, use a portion of that to pay down your mortgage.
The mortgage calculator located at http://www.mortgages-loans-calculators.com/Calculator-Mortgage-Payoff.asp will help you to see your progress.
Keep Track of Your Expenses
If you don't do it yet, resolve yourself to keep an expense ledger of all spending. Just the mere act of jotting down all your expenditure will reduce your expenses up to 20 percent. The reason is when you start keeping track of the money you spend, you become more careful and discerning in your buying decisions, which in turn help you cutting back and saving hard earned money.
Here's to making 2012 your best financial year yet!
Friday, January 6, 2012
Monday, January 2, 2012
WHAT WILL YOU ACHIEVE IN 2010?
Every living thing is either growing or dying. Every plant,
every animal and every business is either becoming more
powerful, more creative, more vibrant and dynamic, or it is
shrinking, perhaps preparing to die.
How is it with your business, right now?
In the coming year, thousands of businesses will close their
doors. In 2012, thousands of professionals will see their
income decline, and some will give up, change careers and
move on. But not you!
Let others become frustrated or stuck, but NOT YOU!
In 2012, I want your business to grow! I want you to add new
products or services. In 2012, I want your business to
capture new markets, improve your services, raise prices,
and increase profits. I want 2012 to be your best year ever!
And, only you can make it happen. As a business owner or
leader, it is your responsibility to develop and execute
strategies to grow your business. No matter how many daily
tasks or small jobs you do, your PRIMARY responsibility is
to grow the business and now is the time to figure out
exactly how you will do that in 2012.
every animal and every business is either becoming more
powerful, more creative, more vibrant and dynamic, or it is
shrinking, perhaps preparing to die.
How is it with your business, right now?
In the coming year, thousands of businesses will close their
doors. In 2012, thousands of professionals will see their
income decline, and some will give up, change careers and
move on. But not you!
Let others become frustrated or stuck, but NOT YOU!
In 2012, I want your business to grow! I want you to add new
products or services. In 2012, I want your business to
capture new markets, improve your services, raise prices,
and increase profits. I want 2012 to be your best year ever!
And, only you can make it happen. As a business owner or
leader, it is your responsibility to develop and execute
strategies to grow your business. No matter how many daily
tasks or small jobs you do, your PRIMARY responsibility is
to grow the business and now is the time to figure out
exactly how you will do that in 2012.
Friday, December 30, 2011
HOW TO OVERCOME 7 OBSTALCES TO NEW YEAR'S RESOLUTIONS SUCCESS
I love the New Year. I feel like I am the threshold of a new year. I am glad that there is a week between Christmas and the New Year because it gives me a chance to recover, regroup, and rethink. Of course, I would like to think of a new year as a fresh, blank, Big Chief Tablet to write whatever I like on, but that is not really the case.
Our lives are not marked off in 365 day intervals, where everything begins a new on day one. There are many things, situations, circumstances, and processes that transcend years and even decades. Example include careers, an education, a marriage, self-improvement efforts, and other long term goals like financial management. Life is a continuous process.
Even in the midst of these processes, a new year, however, gives me an opportunity to evaluate my progress, assess my accomplishments, and rethink the areas that need improvement. I can look back over the last year and determine the progress I made and assess areas that continue to need a lot more work.
I hear people say that they don't make New Year's resolutions anymore, that they subjected themselves to making and breaking them year after year for decades.
I humbly suggest that New Year's resolutions still have a place in most of our lives.
"Resolutions" only have real resolve if they are initiated and owned by the person making the resolution. If they are "shoulds" directed by nameless and/or not-so-nameless others, they are not truly resolutions. These "shoulds" dressed up like resolutions seem to reflect a recognition of a need to change, yet without the commitment and/or the plan to do so.
We have all heard of the 80% failure rate of New Year's resolutions and perhaps have thought, "what's the use?" There are many possible reasons why New Year's resolutions fail, including the following:
l. They are/were other directed at the outset.
An example would be the resolution to quit smoking because your wife/husband demands it. If your significant others are demanding that you quit, don't grumble about quitting for them. Don't approach quitting with resentment and reservations. Instead, acknowledge that even though you have some mixed feelings about quitting, put all your effort into it and focus on the reasons that you want to quit. Make quitting (and any other New Year's resolutions) meaningful to you.
2. The expectation does not fit the reality of the goal.
An example would be the resolution to lose weight. No matter what methods you may be using to try to lose weight and regardless of the ads you see on tv and on the internet, the pounds will not magically fall off. No matter what your goal, make sure that your expectations are reasonable. Otherwise, you may just give up. With the example of losing weight, consider how often have you given up upon losing "only" five or ten pounds after changing eating habits and walking daily for three months? In reality, changing how you eat, regular exercise and utilizing other lifestyle changes should yield generally improved health and some weight reduction results within a year. For most difficult goals or resolutions, setbacks and less than perfect results should be anticipated.
3. The goal may not include an appropriate method to achieve it.
An example might be the resolution to cut back on drinking. When after multiple attempts at this New Year's resolution, it may become obvious that "cutting back" is not the appropriate approach to solving whatever problems are associated with the drinking. Previous attempts to cut back or to quit drinking may signal alcoholism, an illness that often requires formal treatment/help to arrest it--and total abstinence, not cutting back.
4. New Year's resolutions may involve a veritable laundry list, including everything but the kitchen sink.
This shotgun affect just identifies some things that you might not like about yourself or your life, but does little to bring about actual change.
5. New Year's resolution(s) are verbalized but not written down and so are easily forgotten.
There is no start date, no reminders, no criteria for measuring success along the way.
6. Resolutions may even be written down, but are not fleshed out with measurable goals or short term, mid-range, and long term objectives that serve as a roadmap or blue print for how to accomplish them.
If you have a resolution, turn it into a goal, make it measurable, then plot out a strategy over time on how to get there from here. Develop a time-frame. Example: For saving money this year, I will have $50 taken out of my checking account and moved to savings each pay period. By this time next year, I will have at least $1200.00 in savings.
7. Reluctance to make a commitment or to tell others about your resolutions or goals may reduce the vulnerability that you feel about possibly looking foolish, but it undermines your efforts.
When you let others know that you have a goal/resolution, you allow others to assist you in your efforts. Perhaps some of the people closest to you have the same ones. You could team up.
Some of the most common New Year's Resolutions are to 1) lose weight/get healthy, 2) save money/manage debt, 3) get a better job, 4) get an education, 5) stop drinking/smoking/gambling, 6) improve the quality of your life by spending time with loved ones/manage stress better/learning how to enjoy life, 7) find a partner/be a better partner. Most of these goals take longer than a year to accomplish, but much progress can be made within a year, and the process is the prize
Our lives are not marked off in 365 day intervals, where everything begins a new on day one. There are many things, situations, circumstances, and processes that transcend years and even decades. Example include careers, an education, a marriage, self-improvement efforts, and other long term goals like financial management. Life is a continuous process.
Even in the midst of these processes, a new year, however, gives me an opportunity to evaluate my progress, assess my accomplishments, and rethink the areas that need improvement. I can look back over the last year and determine the progress I made and assess areas that continue to need a lot more work.
I hear people say that they don't make New Year's resolutions anymore, that they subjected themselves to making and breaking them year after year for decades.
I humbly suggest that New Year's resolutions still have a place in most of our lives.
"Resolutions" only have real resolve if they are initiated and owned by the person making the resolution. If they are "shoulds" directed by nameless and/or not-so-nameless others, they are not truly resolutions. These "shoulds" dressed up like resolutions seem to reflect a recognition of a need to change, yet without the commitment and/or the plan to do so.
We have all heard of the 80% failure rate of New Year's resolutions and perhaps have thought, "what's the use?" There are many possible reasons why New Year's resolutions fail, including the following:
l. They are/were other directed at the outset.
An example would be the resolution to quit smoking because your wife/husband demands it. If your significant others are demanding that you quit, don't grumble about quitting for them. Don't approach quitting with resentment and reservations. Instead, acknowledge that even though you have some mixed feelings about quitting, put all your effort into it and focus on the reasons that you want to quit. Make quitting (and any other New Year's resolutions) meaningful to you.
2. The expectation does not fit the reality of the goal.
An example would be the resolution to lose weight. No matter what methods you may be using to try to lose weight and regardless of the ads you see on tv and on the internet, the pounds will not magically fall off. No matter what your goal, make sure that your expectations are reasonable. Otherwise, you may just give up. With the example of losing weight, consider how often have you given up upon losing "only" five or ten pounds after changing eating habits and walking daily for three months? In reality, changing how you eat, regular exercise and utilizing other lifestyle changes should yield generally improved health and some weight reduction results within a year. For most difficult goals or resolutions, setbacks and less than perfect results should be anticipated.
3. The goal may not include an appropriate method to achieve it.
An example might be the resolution to cut back on drinking. When after multiple attempts at this New Year's resolution, it may become obvious that "cutting back" is not the appropriate approach to solving whatever problems are associated with the drinking. Previous attempts to cut back or to quit drinking may signal alcoholism, an illness that often requires formal treatment/help to arrest it--and total abstinence, not cutting back.
4. New Year's resolutions may involve a veritable laundry list, including everything but the kitchen sink.
This shotgun affect just identifies some things that you might not like about yourself or your life, but does little to bring about actual change.
5. New Year's resolution(s) are verbalized but not written down and so are easily forgotten.
There is no start date, no reminders, no criteria for measuring success along the way.
6. Resolutions may even be written down, but are not fleshed out with measurable goals or short term, mid-range, and long term objectives that serve as a roadmap or blue print for how to accomplish them.
If you have a resolution, turn it into a goal, make it measurable, then plot out a strategy over time on how to get there from here. Develop a time-frame. Example: For saving money this year, I will have $50 taken out of my checking account and moved to savings each pay period. By this time next year, I will have at least $1200.00 in savings.
7. Reluctance to make a commitment or to tell others about your resolutions or goals may reduce the vulnerability that you feel about possibly looking foolish, but it undermines your efforts.
When you let others know that you have a goal/resolution, you allow others to assist you in your efforts. Perhaps some of the people closest to you have the same ones. You could team up.
Some of the most common New Year's Resolutions are to 1) lose weight/get healthy, 2) save money/manage debt, 3) get a better job, 4) get an education, 5) stop drinking/smoking/gambling, 6) improve the quality of your life by spending time with loved ones/manage stress better/learning how to enjoy life, 7) find a partner/be a better partner. Most of these goals take longer than a year to accomplish, but much progress can be made within a year, and the process is the prize
Wednesday, December 28, 2011
WINNERS PREPARE TO WIN
You have only a few days until the end of the calendar year.
For most of us, that's the end of the tax year, the end of
at least some deadlines we set for our goals, and the
beginning of a new chapter in our lives. Don't blow it!
As I write almost every year, there are some purchases you
should make by December 31st. You need new supplies, new
equipment, new software or tools to make next year more
productive. And the really nice thing is that if you take
action by the 31st, the government will help pay for them!
How cool is that? Don't cheat (it never pays!) but be smart
and use the law to your advantage.
Do your bookkeeping! Are there contributions you should
make? Is there any tax-loss selling you should do to balance
your investments? Be smart about this. Take time. Take a
look. Plan wisely and act boldly.
Ask yourself smart questions. Review your performance this
year. Are there things you should change next year? Things
you should stop or re-think, or modify? Write them down!
And plan wisely. The new year brings endless opportunity. It
has enormous potential! What will you learn and do in 2012?
Who will you become in the next twelve months? What will you
achieve or create, what will you build in the coming months?
Decide thoughtfully. Not every impulse or whim deserves to
become a goal, but there are a few essential items that you
should write down, put on your calendar and commit to.
Choose well and follow-through.
And note that this is a common and powerful time to begin
working with a personal coach for the coming year. If you
are not satisfied with your results for 2011, consider a
personal coach, someone to show you the ropes and hold you
accountable for the new year! This is your time! Make sure
2012 is your best year ever!
For most of us, that's the end of the tax year, the end of
at least some deadlines we set for our goals, and the
beginning of a new chapter in our lives. Don't blow it!
As I write almost every year, there are some purchases you
should make by December 31st. You need new supplies, new
equipment, new software or tools to make next year more
productive. And the really nice thing is that if you take
action by the 31st, the government will help pay for them!
How cool is that? Don't cheat (it never pays!) but be smart
and use the law to your advantage.
Do your bookkeeping! Are there contributions you should
make? Is there any tax-loss selling you should do to balance
your investments? Be smart about this. Take time. Take a
look. Plan wisely and act boldly.
Ask yourself smart questions. Review your performance this
year. Are there things you should change next year? Things
you should stop or re-think, or modify? Write them down!
And plan wisely. The new year brings endless opportunity. It
has enormous potential! What will you learn and do in 2012?
Who will you become in the next twelve months? What will you
achieve or create, what will you build in the coming months?
Decide thoughtfully. Not every impulse or whim deserves to
become a goal, but there are a few essential items that you
should write down, put on your calendar and commit to.
Choose well and follow-through.
And note that this is a common and powerful time to begin
working with a personal coach for the coming year. If you
are not satisfied with your results for 2011, consider a
personal coach, someone to show you the ropes and hold you
accountable for the new year! This is your time! Make sure
2012 is your best year ever!
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