Each new year brings the opportunity to reflect on the past twelve months and for many of us, this is a great time to set resolutions for the next year. Unfortunately, most of our resolutions are based upon wishful thinking and we find it difficult to stick to our changes throughout the year. This year, instead of making resolutions that will be hard to keep, make some realistic goals about your money. Money is not the secret to overall happiness, but setting and achieving reasonable financial goals will bring better financial security to you and your family.

Get Out of Debt

Take a serious look at your debt. If you have a mortgage or car loan, you most likely will not be able to pay off the entire balance in full by the end of the year; however, if your loan allows for paying off the loan early, consider making larger payments toward these obligations. What about your student loans? Can you pay them off by the end of the year? If not, can you pay more toward these loans this year? Do you have other financial obligations you can pay off if you rework your budget?

Pay off your credit card balances. If possible, start using your credit card as a second debit card. Get in the habit of transferring funds to your credit card regularly. If you find yourself thinking about swiping your card and paying off the item later, think again. Swipe your credit card when you are confident you can immediately transfer the funds to cover the transaction. This will also save you the cost of paying interest on your credit card purchases. If you do not have a revolving balance, no interest will be charged.

Save More

Change your attitude about spending money. Seriously ask yourself each time you make a purchase if the purchase is necessary, if you can really afford it, and if the money would be better used by saving instead. This does not mean you give up every purchase that doesn’t directly relate to food, shelter, or medical care. For example, purchasing a new dress for your sister’s wedding is a reasonable expense. Consider instead how much you spend on the new dress.

If you don’t have savings built into your monthly budget, start now. Get in the habit of transferring even small amounts to your savings account each month. Think of this money as paying a bill to your savings account, not just moving your money around. The very definition of saving implies that you are setting aside your assets for something more important. When something unexpected happens, like needed car repairs, or finding out you’re expecting a baby, you will be grateful you have money set aside to help with unexpected financial burdens.

Save for Something Fun

Start a savings account, or even start filling a jar with loose change you intend to use toward a fun goal. Again, make this goal realistic and get the whole family involved. Maybe you want to take a family road trip, purchase new books, get a special gift for a family member, or even go to a fancy restaurant together. Remember that this money is set aside for your common goal. Don’t steal from the fun jar thinking that you can easily return the money. Decide on a purpose. Get everyone to contribute regularly and enjoy your reward when the time comes. Teach your children to set goals, work hard, make sacrifices, AND enjoy the reward.