And this year, we have another chance to get it all right because all of us must have already made personal targets to achieve in the New Year, but have you ever made any resolutions concerning your personal finances in the New Year? If so, how did you do? Did you attain your financial goals, or was this year a total financial washout for you?

Don’t worry, if you have not done it till now, you still have time again to make a New Year celebration, along with the traditional resolutions that we all make, to be healthier, to manage our money better, to spend more time with family and friends and less at the office (or vice versa!), and while we may or may not stick to all our resolutions, there are some that, if we do stick to, would certainly make life much easier.

You can, and you will, do what needs to be done, to completely streamline your personal finances. And remember, if you do these few very crucial things right now, you are more likely to succeed than if you say ‘I’ll do this later’.

The good news about New Year’s resolutions is that you get to make new ones each year. It’s even better if you can keep the good ones from the past year.


Financial Resolution # 1 – Invest with Plan

Knowledge is your currency and financial education is empowerment.  As you become financially literate more, you will be able to naturally make better decisions. Get plan before any investment as without plan, investment is like throwing money into pond. So, learn one new thing about investing this year as to firstly invest in plan to achieve specific goals, not chasing returns and money.

So, Figure out your needs, and pursue that objective. That means asking questions about your future and mapping out a plan in response. When are the kids going to college, and what’s that going to cost? When do you want to stop working? How much do you want to spend in retirement? How much traveling do you want to do? Recognize and act on that. Not sure where to start? Here are a few ideas:

Financial Resolution # 2 – Make your own Net worth Statement

If you haven’t done so already, The New Year is as good a time as any for determining what you’re worth financially, of course. Calculating your net worth is a key step to assessing your financial health and reaching your financial goals. Looking closely at all your assets and liabilities helps create a clear picture of where you are prioritizing your current spending and saving and where you need to make changes in your spending and saving habits.

It’s a good idea to recalculate your net worth each year to keep on top of your progress towards your financial goals and correct any mistakes you’re making before they create overwhelming debts.

Financial Resolution # 3 – Spend less and Save More

Look at what you spend over the course of a year on clothes, gadgets and household items. Suppose that figure is Rs 50,000. Make it your job this year to buy whatever you are going to buy, but for half the price. If you save 25,000, that’s like earning an extra Rs 2083 per month.

Create a watch list, or wish list, of items you want to acquire at half price. Develop a routine of checking in with the stores and websites to see if your items are on sale. At one point, you would see half price by the end of season. Patience pays off.

 Financial Resolution # 4 – Get Prepare for Unexpected

The unexpected can derail your finances if you aren’t getting properly prepared. Your financial life can be upended by all kinds of nasty surprises—an illness, job loss, disability, death, natural disasters or lawsuits. If you don’t have enough assets to self-insure against major risks, resolve to get your insurance in shape.

So, Cut back on personal spending and build up a fund with at least six months’ worth of living expenses. This will financially prepare you, should you experience unemployment or a different setback.

Financial Resolution # 5 – Find the Right Financial Advisor

Do you realize the wrong financial advice, and thus the wrong financial advisor, could be costing you thousands of rupees a year? Do you know how your advisor is compensated? How does that compare to other advisors? Do they have the expertise you need?

Even if you prefer to do things yourself, the occasional check up from an advisor who charges hourly fees may provide you with some valuable tips.

Final Thought

Even if you develop feasible financial resolutions, you’ll have a hard time achieving them if you don’t map out a plan. Write your resolutions down and set 30-, 60-, and 90-day goals to ensure that you stay on track. Also, consider rewarding yourself for staying on track and achieving your resolutions. Setting financial resolutions for next year is a great idea, but it will be an exercise in futility if you don’t make a commitment and set a plan to achieve them.

What financial resolutions are on your docket for 2014?

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Suresh Kumar Narula

SEBI Investment Advisor, Founder & Principal Financial Planner at Prudent Financial Planners
Suresh K Narula is founder and Principal Financial Planner at Prudent Financial Planners. He has earned the professional CERITIFIED FINANCIAL PLANNER and got registered with SEBI as Investment Advisor. He writes on personal and financial planning articles and got published in Dainik Bhaskar, Business Bhaskar and The Financial Planner's Guild, India. He is also a member of Financial Planner's Guild India ( An association of practicing SEBI registered Investment advisers) to create awareness about Financial Planning in general public, promote professional excellence and ensure high quality practice standards. Suresh received his an from Himachal Pardesh University and an MFC from Punjab University, Chandigarh. He can be reached at
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