How to Get Off to a Good Financial Start in the New Year


How to Get Off to a Good Financial Start in the New YearSince we’re all making resolutions for the New Year, one of the most important areas of focus should be your finances. Today, we’re going to cover a few very basic and easy options to improve your finances. The key to improving is to set real, achievable goals. Following through is key as well. Here are some areas of focus to consider this year:


  • Budget focus – The budget is the root of all financial success stories. The simple mantra of spending less than you make will always hold true. As such, take a look back at how you did in 2013 and what sort of issues or expenses kept you from having a surplus in given months. Looking ahead to 2014, project what your monthly budget looks like. Then execute with some of the ideas below.


  • Recurring expenses – I always like to focus my efforts on expenses that repeat themselves each month. The usual suspects are utilities like electric and gas. But also consider phone bills and any subscriptions you have. If you find yourself in the red most months, consider cutting all subscriptions. Chances are, you’re not using many of them. That’s what I found when I cut my newspaper and some online services.


  • Cost-cutting options – If you look back at just last month’s expenses, surely there are a few things you could have done without. Imagine how much extra money you’d have right now if you didn’t spend on those items. Project that though into this next month and see if you can avoid similar expenses. Next, focus some efforts on weather-proofing your residence to reduce energy bills. Finally, there might be some behavioural changes to undertake like always turning off lights and appliances or installing a smart thermostat.


  • Map large annual expenses – A true budget-killer is the large unplanned expenses. This could be an annual tax bill or vacation. Many times, people plan on their monthly expenses, but don’t set aside enough to cover large expenses annually. I like to map out all such large expenses, add them up and then divide by 12. This is the additional amount you’ll need to set aside each month. Some people like to use an envelope to store funds or even a side account in a bank for this purpose.


  • Side-income – Budgeting isn’t only about expenses. If there are ways to increase your income, give them a try. This could be anything from using your free time to work a part-time job to doing some online work. Some people have plenty of old wares to sell off while others may be able to walk dogs or teach piano lessons. Depending on your skills, surely there’s something to do for some extra money on the side. These funds could go towards an emergency fund or to pay off debt.


  • Investing plan – Finally, don’t forget to invest. You don’t want to rely solely on an employer or the government to take care of you in your golden years. By having some of your own investment funds set aside, you increase your odds of financial success later in life.


The information in this article is provided for education and informational purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness or fitness for any particular purpose. The information in this article is not intended to be and does not constitute financial or any other advice. The information in this article is general in nature and is not specific to you the user or anyone else.




Darwin is an engineer and MBA who takes an "evolutionary" approach to finance, writing about adapting to evolving financial management, tax, investing and savings opportunities. Making more money and saving more money is an adaptive process — join the evolution! He blogs at Darwin's Money and ETF Base

    Find more about me on:
  • twitter