Resolving To Have Better Finances In 2017

New Year's resolutions are nearly upon us, and along with getting in shape, cleaning up our finances is one of the most popular resolutions. Now, sometimes things are too far along and there are problems too big to fix with some belt tightening, and that is when people call me to file a bankruptcy. But, if you have not reached that stage, here are a few tips to consider in 2017:

  • Stop automatic payments and write out your bills by hand. Now, this may seem like a huge pain in the butt. However, automatic payments sometimes dull us to the effects of money bleeding out of our bank account. Do you have a $40/month gym membership, but you never go? $200 for cable you never watch? When you actually write out a check, it gets you thinking whether they are worth it. You will become aware. Once you prune some dead weight, you can go back to auto-pay.
  • Write out a budget. This is similar to the last tip, and the logic is the same. Calculate your income exactly after taxes and deductions. Write out every expense. When you actually write out your income and expenses, some expenses will seem pointless. The essentials will be clear.
  • Pick a day of the week to write out bills. BiIls aren't much fun, I know I let them pile up sometimes. That leads to missed payments and late fees. Pick a day of the week (what are you actually doing on Thursday night, anyway?) and pay any bill sitting on your coffee table.
  • Commit to a set amount of savings every paycheck. It doesn't need to be much... $100, $50, even $20. But, the act of committing to some amount (possibly into a separate bank account) will establish a good habit that should eventually snowball into large savings.
  • Cut back on eating/drinking out. This is a pretty common piece of advice, everyone has read the article saying if you cut out Starbucks every day you can save $30,000/year etc etc. But, it is good advice, nonetheless. A night at the bar can easily get to $100. Eating out for lunch every day can cost $50-$70 a week, $2,500-$3,500 a year. You don't need to cut out ALL fun, just some!
  • Donate to a charity. Yes, this costs money. But, it will give you a good perspective about the actual value of money. Once again, it does not need to be a large amount. $2/week even. It's more about the habit and the perspective. You'll spend money in life, you can't save everything. But, it's important what you spend it on.
  • Loving vs. Liking. Do you like buying shoes like me? That's fine, buy some shoes. But, know when you have enough shoes, and the difference between "loving" something and "liking" something. Buy the things you LOVE. Pass on the things you like.

Know yourself and your budget, and your finances will start to look up in 2017 and beyond!