My 2011 financial resolutions were a cinch to come up with. All it actually took was putting them on paper, because I’ve been stewing over them for a while as goals (before December got me into resolution mentality).
Resolution #8: Pay myself first. In October I set up a few INGDirect accounts. I opened five: Roth IRA Fund, Emergency Fund, Irregular Expense Fund, Travel, and Declutter. The idea behind Declutter was that as I sold clothes on consignment I would hold that money out for replacement clothes. It was an okay idea, but I have since decided that I need to prioritize bigger things over clothes. So, each month I contribute to the Roth IRA, Emergency, and Irregular Expense funds.
While it is a little disheartening divvying up my funds into a few different places (it seems to take forever), it definitely helps me ratchet up what I’m contributing. There was a point in time where I thought saving $50 each pay period was sufficient. [Note: It might have been if I was spending the remainder on important things, not just on eating out…] Once I saw that splitting that amount into three accounts meant only giving $16.66 to each, though, it made me reconsider the overall number I was contributing. Even deciding to do $25 to each of the three accounts meant I’d be saving $75 instead of $50; that adds up! Each subsequent month I have become more comfortable pushing the limit on what I put in savings.
I picked up my January 1 paycheck today. As I tried to plan where the dollars would go, I realized that my mentality has shifted on how to determine the amount to transfer into each savings account. I now think, “Okay, if I want my Roth IRA savings fund to reach $200, how much do I need to feed it? $29.93.” I followed the same line of reasoning for the other two ING accounts and for my traditional savings account at Bank of America. After totaling up how much I am saving this pay period, I realized I am saving 50%!! Before I opened the ING accounts that would have never happened.
Getting my paycheck six days into the month isn’t typical. Normally I get it on the 1st; circumstances dictated otherwise this go ‘round. The main point of this resolution is to make sure I allocate for savings before I begin to spend. I don’t anticipate this being too hard; I’m having a blast watching these little accounts grow, even if it’s at a snail’s pace.
Resolution #9: Daily Financial Tracking. I want to continue tracking my daily expenses and reconciling them with my online statements. For Christmas, my boyfriend’s family gave me a NeatReceipts, which I have wanted ever since I read about them here. I’m getting into a rhythm of scanning my receipts and then saving the important ones (credit card and any potentially returnable items) and tossing all others (once they’ve cleared). It’s working beautifully!
Resolution #10: Calculate my “Actionable Net Worth” monthly. Several bloggers have pleaded the case for tracking net worth, but it was the one at Fiscal Fizzle (http://tinyurl.com/27kb5f3) that hooked me. I plan on calculating my net worth on the first or second day of the month. At the same time, I’ll check my credit report (which I do through Credit Keeper) and reassess my financial goals and progress.
Resolution #11: Give some money away. Specifically, I plan to give $250 to my church and $150 to other organizations or charities. These numbers are modest (and probably a little lower than they should be), but I’m taking a few things into consideration, including my low & erratic wages from my part-time job. In the past, my giving has been sporadic and a bit haphazard. This year, I filled out a pledge card for my church, so that it will be able to rely on my contribution and budget accordingly. In some sense, then, my aim is more about giving routinely and deliberately than it is about the dollar value. I hope to give beyond these thresholds. As for the $150, I know part will go to my alma mater and part to NPR. I’m trying to decide which charities I’d like to support and at what levels.
Resolution #12: Open a Roth IRA. As of today, I have saved 20% of the $1000 I need to open a Roth account. To accomplish this resolution I need to save the remainder of the money, research which fund to open, and actually open it. I feel like opening one will go a long way toward making me feel more comfortable with where I am in life right now, financially and otherwise. As in, “I might be a ‘boomerang child’ (which, by the way, my dad announced last month that he liked more than he expected to, ha), a perpetual student, and making next to nothing, but I still have a vision for my retired self!”
Alright! All my resolutions are on the table!