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Three Financial New Year's Resolutions Everyone Can Keep

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With the holiday season nearly behind us, it’s time to start looking forward to the new year. Although we can’t predict what 2014 might have in store, we should be prepared for just about anything. This is especially true when it comes to my area of expertise: finance. After more than 18 years as a financial planner, I know that this subject is often ignored, but simple to address.

Many people make New Year’s resolutions to lose weight, eliminate bad habits or improve a relationship. However, when it comes to personal finance, some folks just don’t know where to start.

That’s where I come in.

Here are my three simple steps for you to make New Year’s resolutions that actually stick so you can get 2014 off to a great start.

  1. Increase retirement savings by 1%
    While the standard rule of thumb is to put away between 10% and 15% of your annual income each year, don’t worry if you’re not there yet. In fact, even an increase of 1% can make a big difference down the road. This is especially true for younger members of the workforce. According to the Society for Human Resource Management, this small boost in savings can result in a much healthier retirement check at age 67. If you’d like to see what effect a savings increase might have for you, try using the retirement contribution calculator at The bottom line is that by saving a little more today, you can reap bigger rewards tomorrow.
  2. Use your salary increase this year to pay down debt
    Some of you may find yourselves in the enviable position of getting a raise in the near future. When money is tight, the temptation can be very strong to take that salary increase and plan for a vacation or buy a new car. Before you do any of that, I would encourage you to get yourself out of debt first. Debt is like an invisible anchor, holding you down, but getting rid of that weight is easier than you might think. Rather than using your bump in pay to go on a spending spree, use it to pay down what you already owe. This handy debt planning tool from CNN will show you how quickly you can become debt-free without breaking the bank. Once your balances are paid off, you can enjoy a stress-free vacation, and when you do decide to purchase a car, your interest rate will be much lower.
  3. Get your financial affairs in order
    As the old saying goes, there are only two things in life that are certain. One of them is taxes. The other one we don’t like to think about too much, but it is something for which we should be prepared. A 2011 article from states that more than half of Americans don’t have a will or other estate plan in place. This is a troubling statistic to me as a financial planner because I have seen firsthand all too often, the financial mess that is left behind when a family member with assets passes away with their personal affairs in complete disarray. In fact, this scenario played out so frequently that I developed a system for my clients to make it easy for them to organize all their most important documents. It’s called The Everything Binder; Fianancial, Estate and Personal Affairs Organizer, and you can find it at my website, It won’t take long for you to complete, but the benefits of having it done will last forever.

Remember, finance doesn’t have to be complicated, and small changes can have a big impact over time. Make a promise to yourself that 2014 is going to be the year you start getting a handle on your finances. Together, we will put you on a path to success and prosperity. Happy New Year!

Maloon, Powers, Pitre & Higgins, LLC is a Registered Investment Advisor. Securities offered through Financial Telesis Inc. (Member FINRA/SIPC). Financial Telesis Inc. and California Financial Advisors are not affiliated companies.



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