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Baylake Advisor: It’s never too late to make a good resolution
January 28, 2009-- Just because New Year’s Day has come and gone, don’t miss the chance to
institute a change to improve your health – physical, emotional or financial. As
a banker, I would be remiss not to offer suggestions for improving your
financial health.
Money worries are the most common cause of stress according to Mental Health
America. Additionally, according to the American Academy of Matrimonial Lawyers,
problems relating to financial matters are a major reason why marriages break
down. Therefore, it seems that making a resolution to improve your financial
health has many long-term benefits, far beyond a monetary standpoint.
There are many small things we can do that will make big changes in the long
run. Here are some that will work for many of us:
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Determine your long-term financial goals. If you are in a relationship, discuss your individual ideas and develop consensus on your joint priorities.
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Create a plan to reach your goals. This can be as simple as writing things down on a legal pad, to as formal as working with a financial advisor to develop a written plan.
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Track your spending. You will be amazed at how much you spend on some pretty unimportant items. Make a commitment to cut out a specific item or dollar amount. Then, consistently devote those dollars to a savings plan.
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Reduce your debt.
a. If possible, stop accumulating frivolous debt. Resolve to pay cash. Save up for major purchases. Don’t buy things you really don’t need.
b. Pay extra on revolving, installment or mortgage loans. Any additional dollars over and above the required payment saves you interest and gets you closer to being debt free.
c. Think twice and do your homework before making any large item purchases. A new car might be nice but has the old one really outlived its usefulness? If a new car is necessary, make the decision based on reliability, cost-effectiveness, and gas consumption – not just style. -
Make good investment decisions. Oftentimes it makes sense to seek advice. Volatile times require us to work harder to act with discipline instead of emotion. You may need to re-allocate your investments, but do so based on your long-term plans, your time horizons, and your risk tolerance. And don’t stop investing; you will reap rewards when the market returns.
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Improve your cash position. Everyone should have an emergency fund of three to six month’s worth of living expenses. Our parents called it saving for a rainy day; we can call it being financially savvy. Whatever the name and whatever your situation, make sure you have liquid funds both available and safe.
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SAVE! Whatever you choose, resolve to take at least one of the steps above to start socking it away. By 2010, you will be feeling much better about yourself and your future.
Baylake Bank, Member FDIC/Equal Housing Lender, employs over 320 individuals throughout northeastern and central Wisconsin and serves its communities from 28 financial centers in Brown, Door, Green Lake, Kewaunee, Manitowoc, Outagamie, Waupaca, and Waushara counties and from its website at www.baylake.com. For more information call (920) 743-5551 or 1-800-267-3610.
Marcia Peterson is a Private Banker for Baylake Bank. Baylake Bank, Member FDIC/Equal Housing Lender, employs over 320 individuals throughout northeastern and central Wisconsin and serves its communities from 28 financial centers in Brown, Door, Green Lake, Kewaunee, Manitowoc, Outagamie, Waupaca, and Waushara counties and from its web site at www.baylake.com. For more information call 920.743.5551 or 800.267.3610.