The best resolution is one you can keep. This rule applies whether you’re aiming to improve your health or get a handle on your personal money management.
November is Financial Literacy Month in Canada, a national program to help Canadians build strong money management foundations through knowledge and resources. Fitting within this month-long initiative, Credit Education Week Canada runs November 12 to 16, offering free workshops across the country.
This year’s Credit Education Week theme is “money resolutions” – making it a great time to take control of your finances. The right money resolution will leave you feeling empowered and help you to establish good financial habits that will last a lifetime.
When it comes to setting money goals, a simple rule will help your resolution stick: be specific. If you’re like me, a vague self-promise to save money is doomed to fail. Without establishing quantifiable measurements, you can’t track – and be encouraged by – your progress.
Telling a friend or family member about your financial resolution will help make you accountable. Why not go one step further and find a resolution “buddy” – someone who shares a similar money goal. The buddy system will help keep you in check and a little friendly competition is an effective motivator.
A goal with clear, positive associations will also help motivate your success. For instance, you’re more likely to save for the tropical vacation you’ve always dreamed about or a Spanish course you’ve always wanted to take, than you are likely to eliminate all frivolous purchases cold turkey.
Here are 10 money resolution tips to help instil positive habits and get you on the road to financial success:
1. Establish a savings goal – Make the goal realistic and positive, and track your progress.
2. Try the buddy system – Sharing similar financial goals will keep you accountable, and make saving more fun.
3. Get advice – If your road to financial well-being seems riddled with potholes, seek advice from an expert. The simple act of talking about money challenges is a huge first step.
4. Establish an emergency fund – Are you financially prepared for a layoff? What if you suffered an accident or developed a medical problem that prevented you from working? A “rainy day” fund might not sound exciting, but will provide a sense of financial well-being.
5. Leave the car at home once a week – Simple, right? Walking, cycling or taking transit will save you money on fuel and possibly parking, and can promote good health at the same time.
6. Set up automatic bill payments – Save yourself the hassle of making payments each month, and avoid late fees while you’re at it!
7. Get a tax-free savings account – It’s easy, and you can contribute up to $5,000 each year. Visit www.tfsa.gc.ca to learn more.
8. Set up automatic monthly withdrawals – Once savings and fixed expenses are taken “off the top” of every dollar you earn, the amount left in your checking account can be spent, guilt-free. (But remember to spend wisely!)
9. Sign up for your employer’s matching RRSP program – If your employer offers matching retirement savings contributions, why not take advantage?
10. Be patient. It’s much easier – and quicker – to spend money than it is to save. Stay focused on your priorities, and stick to your resolutions. As the saying goes, “Rome wasn’t built in a day.”
By the time this holiday season comes along, you’ll not only have a clear, positive money resolution – you’ll be on your way to achieving your goal!
For more personal finance tips and information, check out www.PracticalMoneySkills.ca.
Melissa Cassar is the Head of Corporate and Public Affairs, Visa Canada. She directs Visa’s financial education programs in Canada. To follow Melissa Cassar on Twitter, visit: www.twitter.com/MoneySkillsCA
This article is intended to provide general information and should not be considered an endorsement or legal, tax or financial advice.