New Year Resolutions - Money Management Strategies that will Change Your Life

The festive season might not be the time we really want to be reminded about budgets and spending limits, but considering many businesses hand out bonuses and it is time to set New Year goals, why not get a step ahead on your bank account.

Money management, like playing sport, takes time, discipline and some practice to perfect. And as with practicing any skill, it can often be coupled with feelings of frustration and disappointment. Managing your money well does not necessarily mean having every material object your heart desires, but it does mean you understand what it is to live within your means and minimizing financial stress and the consequences of excessive debt. The rewards of managing your finances well extend much further than only just your bank account.

Write them down and then create a plan with the following strategies in order to reach your targets. Perhaps divide them into short and long-term goals to keep better track of your progress, and keep them realistic. Winning the lottery is not a realistic goal.

Make adjustments to cut costs where possible and decide how much you are able to commit to setting aside monthly for savings, an education fund or perhaps a holiday fund. Start putting a plan into action that will ultimately lead to reaching your year-end goal.

Absolute necessities for living should take priority in your budget. A problem starts to occur when we spend money on luxuries whether it be a new pair of shoes, weekend entertainment or having spa treatments and then fall short on living expenses such as rent, electricity, and debt payments. Getting to where you want to be financially will take sacrifice at first, and that may mean eating out less, forgoing the new clothes for a few months and returning to basic living. Your efforts and hard work will pay off in the future, so keep looking ahead, instead of what you may be sacrificing for instant gratification now. We do not really need most of the things we want.

Buying a Ferrari when you can really only afford to take the bus means you are burying yourself in debt and a financial disaster of a future. Eat the foods you can afford, don’t wear Prada if you can hardly afford Nada and don’t stretch your budget for the penthouse if it places too much financial pressure on your family. Rather live within your means now and save up to purchase more expensive items without the additional cost of paying interest and the possible consequences of missing a monthly payment.

My Money Coach agrees that "It’s not how much you make, but what you do with what you've got. Proper money management does not involve a magic formula to find more money. It simply means getting the most from the money you do have."

"Once complete, your budget is the solid foundation with which you can manage your current income and expenses and plan for future possibilities."

Good Luck!

Tell us below what you are hoping to achieve financially in the year to come?