Nine Resolutions

Resolutions
Reading about how to improve your personal finances is a start, but it has absolutely no meaning if you don't act on it.
Before you can get anywhere with your personal finances, you need to begin — right now.
So what are the steps you should be taking to get your personal finances in order?
Here's a list that you can look at every day, and try to improve your lot. Let's start with getting your banking accounts in order.

1. Pay off all credit card debt:
Credit card debt is Enemy No. 1. If credit card bills are not paid off in full every month, there is a huge negative impact.
Sit down and work out a plan to pay off any debt that you currently have, using the snowball method that best fits your personality. This has to be top priority.

2. Understand the difference between wants and needs
To keep your finances in perspective, you need to understand the difference between wants and needs. There is nothing inherently wrong with small luxuries, and you should be able to enjoy the nonessentials in this life.
But it is important to realise that wants are not needs. If you master this skill, your finances will be in a much better shape.
Critically evaluate your true needs versus your wants. If you are having trouble distinguishing between them, just eliminate impulse spending.

3. Live on less than what you earn
There are no two ways around this one. If you want to keep your finances in order, you need to live on less money than you make. That would mean either purchasing items and services that cost less than what you currently make, or figuring out a way to increase your salary so that you can spend more (but still less than you make). Either of these is fine. Track your spending and create a budget. If you are spending more than you are making, you need to decide whether to curb unnecessary costs or figure out how to increase income. Most people can balance their budget without changing their current lifestyle.

4. Pay yourself first
Before you pay any bill, you should pay yourself a range of 15% to 30% of your take-home salary. This money is not part of your monthly spending budget. Go to your bank and set it up so that your paycheck is automatically deposited, if possible. Then set it up so that an auto payment is made from your paycheck into a specified account that is not used for monthly expenses.

5. Set financial goals
In order to reach your financial goals, you need to know what those are. Nobody can determine these except you. You need to take the time to figure out exactly what your financial goals are so that you can take the necessary steps to reach them. If you don't know specifically what your goals are for this year of the next 10 years, take the steps needed to create them.

6. Educate yourself and be responsible for your decisions
It is convenient to hand over money matters to someone else, but you mustn't do this. Part of being financially responsible is having final say in all decisions about your money. That doesn't mean you can't seek advice, but in the end your money is your responsibility, and you are the only one who is going to truly look after it.
Someone else to look after it, it's time to take back control. No matter what, spend an hour or two each week reading articles on personal finance or visiting web communities where you can ask questions.

7. Save and invest
Take the money that you pay yourself first and either save or invest it to make it grow and work for you in the future. If you are carrying credit card debt, invest in it first. But also make sure to take full advantage of the saving and investing opportunities that are available. Make sure you have an emergency fund.

8. Protect your finances
You will take the necessary steps, usually through insurance, to make sure that your assets are protected in case of a disaster. Take the time to make sure that all your assets are properly insured, and reevaluate this every few years or whenever a major life change occurs, such as marriage or a new addition to the family. Also be sure to compare insurance rates on a regular basis, since this is a competitive business.

9. Donate to worthy causes and to those less fortunate
No matter how desperate your finances may appear, if you are reading this article, there are a lot of people in the world who are far worse off than you are. It's important to nurture a sense of giving and to be thankful for the small things you have. That means donating to worthy causes on a regular basis. If you are in the habit of giving, chances are you will be less greedy as a person.