Five Money Saving New Year's Resolutions

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There are plenty of reasons not to make New Year's resolutions for the coming year. Why? Most resolutions end in failure.

But if you insist, you can make success more likely. If you treat your New Year's resolution like a baby step instead of a huge leap, you are much more likely to achieve it. That way, your finances will be in better shape come 2010. Here are a few resolutions to consider.

Credit card payments: Make a New Year's resolution to pay more than the minimum amount on your credit card, even if that means only putting in an extra dollar. The best way to approach this is through the snowball method of debt reduction. That additional dollar means you have taken the initial step to achieve credit-card debt-reduction success.

Why you can keep this resolution: Twelve extra dollars a year is something anyone can afford. While the hope is you can pay much more, the $1 minimum will allow you to keep the resolution even during months when money is tight.

Read a personal-finance book: You don't even have to buy one; look at your library. If you are worried you will fail this resolution because you think all personal-finance books are dry and dull, try David Chilton's The Wealthy Barber, which is set up more like a story than a "how to" book.

Why this resolution will work: All you need to do is read a book. You don't have to make any changes. Without that pressure, you can simply read, digest the material and decide which, if any, of the book's recommendations make sense for your situation. Chances are that you'll find a number of points you should be doing but aren't.

Track expenses for a week: Choose a week where you keep track of all your expenses down to the penny. It doesn't need to be a fancy system. Keep a small notebook in your pocket or enter each expense into your personal organizer or phone.

Why this resolution will work: All you have to do is record your spending to succeed. You're not being asked to reduce spending. The hope is that you will realize you are spending a lot more than you thought in certain areas, and you won't need any prodding to make changes. The time period is short enough that it shouldn't be a burden.

Play a money-saving game: If saving money is on your list of goals, play a money-saving game instead of trying to slash spending. Many people already play money games without even realizing it. Keeping a coin jar is one example.

Why this resolution will work: By simply playing the game, you have succeeded, no matter how little or much you save. It's usually much easier to save money if you make a game out of it and turn it into a challenge rather than a chore. You know what motivates you the most, so you can tailor the game with that in mind.

Find a new income stream: The part of personal finance that often gets ignored when it comes to improving your finances is earning more money. Just as you want to be diversified in investments, diversifying your income is a positive step. There are many hobbies that can be turned into income streams with a bit of thought and effort. And there are plenty of part-time businesses you can begin that cost little to no money.

Why this resolution will work: If you learn to make $1 in some new way, you have succeeded. You aren't forcing yourself to find something you can do to replace your current income. In most cases, it's the process of starting that is the hardest, but expanding your earnings from this new source should be quite easy if you want to.

Remember to break down major goals into simple steps to get yourself going. By doing so, you will start off in the right direction and build on your resolution with more goals.

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