There's a trick to making good on New Year's resolutions

BY NOW, the joy of welcoming the New Year may have been replaced by frustration that all the resolutions made so earnestly just a few days ago are starting to look a little shaky.

The fact that you made a resolution means you know it's important to make changes in your life - the way to make that happen is to set goals. They work because, once you set a goal and work toward it, the achievement of that goal becomes your dominant thought.

First, look forward 20 years, and imagine your future if you don't improve your money management skills. Every week will be a growing struggle to pay bills, each interest rate rise a nightmare and you will face years of waiting if you need major surgery. Now imagine the opposite - a house paid off giving you free rent for life, a growing investment portfolio, freedom to travel, and the ability to have the best medical health if it becomes necessary

Gaining financial independence is a matter of putting aside part of your current income and investing it to be used in the future. Obviously to do this you must be spending less than you earn, so the first step is to do a simple budget to find out exactly where you stand. It's only a matter of listing your income on one side of a piece of paper and your expenditure on the other.

You will probably know what the outcome will be before you do the figures. If you are spending less than you earn you will have no pressure on your finances and should be investing regularly, if you are line ball you are probably just getting by, if you are over spending you will probably be living on credit cards as you won't be able to pay the balance each month.

The best way to effect change is by small consistent steps. If two people are walking side by side, and one starts to take a different path, they will still be close after an hour or so. However, after five years, they may be a world apart.

My hope for you for the coming year is that you will start on the road less travelled and make the changes that will make a dramatic difference to your financial future.


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