Five New Year’s Resolutions You Need to Stick with to Manage Money Properly this Year

Any personal finance related resolutions for this year? Well, if you don’t have any, it’s time to think and implement them right away as we have already entered second month of the year. Don’t be left behind, the year is still young to begin with New Year’s resolutions. The New Year offers a fresh start and an opportunity to reflect and refocus on our awful old habits related to money management.

You can make your financial resolutions attainable by following some simple tips.

1. Stay away from impulsive spending: Many a time, we see people come to grocery stores to buy a milk packet and end up shopping with a trolley full of unwanted groceries. This happens with many of us because when we see something we want to buy it, even if it is not required. In other terms it is called ‘impulsive spending’.

Impulsive spending can leave your pockets empty by the end of the month; it may also lead you into debt. Instead of getting into such a situation and regretting your impulsive spending habit, try to stay away from it, by keeping few things in mind.

Always plan ahead before you go for shopping to avoid unnecessary purchases.

• Pay in cash – don’t carry debit or credit cards.
• Don’t spend more time on shopping.
• Spend money only on your needs and think twice when you are spending on your wants.

2. Quit unhealthy habits: Unhealthy habits like smoking and drinking will not only kill you, but also drain your bank account. Quitting these unhealthy habits may be the most difficult resolution to keep up, but it is the most profitable resolution.

If you have the habit of drinking (alcohol) twice a week, minimize it to twice a month. Try to put your hard earned money on something that is functional, rather than on something that ruins your health.

3. Spend within budget: A budget is a guide to money management and it monitors the inflow and outflow of your money. It helps you manage money properly without exceeding your budget limit.

Budget planning helps you in tracking each expense you make and lets you know where you spent unnecessarily. A realistic budget will help you make sensible decisions with regard to how much to save, how much to spend and how much to invest.

4. Save money for emergency cash: Having surplus emergency cash is very important as we never know when unexpected emergencies like health problems, sudden loss of job, etc. will arise. Keep aside some cash for emergencies, to avoid debt. Save money as much as possible till it reaches ‘6 months of your living expenses’.

5. Take adequate term insurance: Last but not the least, take a term life insurance policy. Term life insurance is the least expensive form of insurance. It will provide financial support to your dependents, when you are not there to take care of them.

If you follow these resolutions with sincere commitment and discipline, you will surely manage your money properly and will see yourself in good financial situation this year.