Money Matters - Simplified

Money Pledges for 2011

We all embraced the New Year at the strike of mid-night on 31st of December. So, what are the changes that would you like to bring about in your money habits this year?
Find some time to travel the memory lane and identify where you went wrong last year so that you can make some headway for this year's resolutions.

Even small changes in your money behavior can help you attain a better financial position. The Money Times suggests some money resolutions, capable of changing your money status this year.

Chinese New Year Prosperity Rituals
- To attract good fortune, money, luck, place three Chinese coins tied together with a red ribbon in a red envelope and carry with you in your pocket or handbag.

- Many Chinese people swear by special wish boxes made of porcelain, clay or some other earth-based material. Place a wish, written on a piece of paper, inside the box, which has a mirror on the inside of the lid.

- Fish are believed to be extra lucky and they attract money and all sorts of success. They also represent perseverance (after all, they swim upstream!). So get an aquarium this year.

- The whimsical Three-Legged Toad brings wealth and they are usually shown sitting next to stacks of gold coins so get one to bring money.

With the New Year here it’s time that you consider developing a financial plan for 2011. A financial plan clearly stating the dos and the don'ts can go a long way in averting a financial disaster.

Hear are some money resolutions for the next year that promise to set the path for a richer future:

1. No Wants, Only Save
Your aim this year should be to increase your savings by at least 10 percent. While a 10 percent increase should not pinch you, it can add up to a huge amount by the end of the next year.

And if you still haven’t started saving, this year is perhaps the right time to start doing so. Create a separate savings account where in you can stock all your savings.

A number of banks today offer you the facility to transfer a certain fixed part of your monthly income into another of your account.

You can choose not to take an ATM card so as to make your access to your savings a little difficult and thus keep the temptation of spending that money at bay.

2. Invest Wisely
Your savings are futile if they cannot be invested in the right place and made to grow over time. In fact, if you want to grow richer, the only way to do so is by taking calculated risks. Invest wisely, sit back and watch your money grow.

Invest a part of your savings in real estate property, shares or mutual funds. You could decide to invest around 30 percent of your savings and safe keep the rest by creating separate funds under the headings of emergency, self gifting and maintenance.

Invest wisely and after a careful study of the market. You can even hire a financial planner to get expert advice for planning your investments.

3. Think Before I Leap
This New Year resolution is especially meant for those who indulge in the spur of the moment’ purchase. Remember, binge shopping can be extremely harmful to your financial health.

Plan all your shopping this year, no matter how small or how insignificant. If you like something control your urge to buy it right then and there. Rather come back home and think once again if you really need it, if the answer is still yes and you have sufficient cash, go ahead and make the payment.

This way you will be able to bring down your shopping expenditure by almost 20 to 30 percent and also avoid buying things that you later discover are not really needed.

4. Believe in Cash on Nail
Cash rules! So, pledge that you will make all your payments (as far as possible) via debit cards or in terms of liquid cash this year.

No matter how many credit cards are floated in the market, they all come with a exorbitant surcharge rate if you fail to pay in full within the specified time limit.

So, you either pay cash or make sure that you do not have to part with even a single extra penny by repaying all your credit purchases in full before the due date.

However, since credit cards are fast becoming indispensable, it could be a good decision to automate your credit card payments and other bills. All that you will have to do is instruct your bank to pay in full all your bills before they become overdue.

5. Stitch in Time to Save Nine
Do not procrastinate this year. 2011 calls for identifying and pruning all those financial areas that have been gradually bleeding you of your hard earned dollars. Take a look at your expenditures in 2010 and try to track all those areas where you could have saved had you been a little more careful.

It could be a delayed payment of your kids fees, library fees, membership charges, credit card payments, insurance premium, and so on which come with an additional late charge.

Feed reminders for all due dates in your mobile well in advance and make sure you do not have to pay anything extra.

A review of your last year’s money mistakes can also be a massive eye-opener. So, find some time to travel the memory lane and identify where you went wrong last year so that you can make some headway for this year’s resolutions.