2012 New Year’s Resolutions You Can Take to the Bank

It’s amazing, for all the lip service given to making New Years resolutions, and for the many years human cultures have been observing the amends-making tradition, but then failing to follow through on those goals, you’d think, “abiding by this year’s list” would rank as the most important resolution?

Unfortunately, we fall into our predictable yearly patterns and make – and break – the same old calls to action and behavior modification.  This year is no exception.  At least one recent survey found yet again that “improving general fitness,” and “improve ones financial condition” ranked number one and two respectively as Americans’ most important resolutions.  But if people really stuck to their fiscal guns, the average American saving rate would be rising, not falling, as evidenced by still more data.  After a brief post-recession spike of a 7.1 percent saving rate in mid 2009, those percentages have tumbled to an anemic 3.6 percent – the lowest in four years.

Sticking to your financial goals requires data, discipline, and above all, drive.  Let’s call them the three ‘D’s.

What do I mean when I say data?  Before you and your family can begin to save money, you have to have a better understanding of how and where it’s spent.  It’s easy to estimate broad spending generalities, like assuming that the bulk of your family’s money goes toward the mortgage and food.  But what are the specifics?  The holiday season is a time of year when it may feel like your money is being sucked into a financial black hole; with obligation after obligation and gift after gift bleeding you dry.  Hopefully, you’ve been reading my earlier holiday blog posts this season and have at least begun tracking your holiday expenses.  This is a great start!  Now add to that by carefully tracking all of your expenses.  Your children, too, will benefit from such inclusion.  Track the electric bill, the heating bill, and see how many bags of garbage your family produces in a week.

Once you have a more accurate picture of where your money goes in the first place, your family can begin shifting its direction.  Consider having each family member rank order his or her most important purchases.  Elect to have a family meeting, (maybe after that equally important Sunday family dinner – without the TV blasting) and as a group discuss what can be reduced or eliminated.

Discipline, of course means sticking to the plan.  If, for instance, you’ve begun unplugging electrical devices to reduce the so-called “vampire loads” – the amount of electricity pulled from a wall socket even without plugging in an electrical device – don’t get lazy and start giving up.  Vampire loads add about 10%  to your family’s energy bill.  Wouldn’t it be nice to have that 10% back?  The same goes for your children.  Today’s “always on” marketing and promotional climate makes it difficult for them to tune out commercialism’s noise and choose between needs and wants.  Help them by setting a good example.  Encourage your children to save a given percentage of their quarterly allowance and consider matching those savings for even greater incentive.  Try to see if your children can save more each quarter.

Drive is the more fun cousin to discipline. Once you’ve established a pattern where recognizable savings are apparent, have the drive to continue thinking outside of the box on ways to save.  Whether it’s adding the mini-resolution of never using an ATM that charges a fee, to increasing your paper or mobile electronic couponing, or brewing your own coffee – basic steps like these that can save you and your family thousands a year.

Make the savings process fun for all and just maybe, come next year when it’s time to draft New Year Resolutions list 2013, you will have “saved” at least one of your 10 obligatory spots for something other than getting control of your finances.

You Don't Know How Lucky You Are!

Charity has to be taught, and shown to kids for them to “Get It”.  Yelling the words, “You don’t know how lucky you are!” can seem educational, but they’re really not.  None of us realize how lucky we are.   


“Giving” refers not just to money, but also to you.  On Christmas morning, I used to take my kids into a local hospital to serve meals to elderly people who had nowhere to go.  My kids “Got It”.  My big revelation came when my son, Rhett, was 8-years-old.  We were in a small bodega in New York City so that he could use some of his “Quick Cash” to buy some Tootsie Roll Pops (I was trying to empower him to make his own choices, and was a little liberal on the sugar choice!). 

He had his pops and his money and was standing in line to pay and in front of him was a homeless woman who had a cup of change and an orange.  She dumped out the coins and the owner of the store told her to put back the orange, because she didn’t have enough money.  As she collected the change, my son watched and interrupted and said, “I have my Quick Cash with me and I’d like to buy you the orange, I just need to put back the pops and start to count out my change again.”  


Every eye in the store turned to this little kid.  The woman thanked him and refused to take his money.  Rhett became insistent, saying “I work for my money and I get to choose how I spend it and I want to buy you this orange.  May I?”  Still she was reluctant, but he persevered.  “Don’t you know the rules?” he said.  “This is my money and I chose to buy you the orange, because someday when I don’t have the money, someone will be there to buy me some food.”  


The air was sucked out of the room and filled with sobbing mothers (me included).  The transaction took place, and Rhett joined me in the back of the store, where I was sobbing, “I’m so proud of you for doing this”.  And he said, “You are not supposed to be proud of me when I’m doing something I’m supposed to do.  You are supposed to be proud of me when I do something that I’m not supposed to do!”  Okay, he was right and, yes, the money lessons work!