Having New Year's Resolutions is almost a cliché these days – turning the whole phrase into a definition for 'good intention that is quickly abandoned'.
That unfortunately includes resolutions of a monetary nature – changing your spending habits for example can be just as hard as going from couch potato to four-times-a-week gym junkie.
That's why I've come up with 3 financial resolutions for 2020 that I think anyone can easily stick to.
Run your bank account like a business
If you ask a business owner what the first job of a business is, they will probably tell you that it's to make sure there is money left over when you deduct your expenses from your revenues. The second is probably to increase those leftovers.
That's the kind of mindset I think everyone should have when it comes to their bank accounts. You can't save, invest or get ahead if your account 'balances' at the end of every pay cycle, after all. With this simple aim, you can try and 'budget' without having to knock up a complicated spreadsheet.
Avoid debt like the plague
My parents used to say that the only thing you should borrow money for is a house – and I have yet to find fault with this advice. Sure, you can spend more than you earn using other people's money for a time. But eventually the music stops – and those that have 4 maxed-out credit cards charging you 25% interest are normally the ones without a seat when it does.
Stepping away from the flaringly dramatic, debt is a path towards wealth destruction if used improperly. And most debt that Aussies do have results from this. Whether it's a car payments, personal loans, credit cards or Afterpay Ltd (ASX: APT) and its services – debt is almost always making someone else rich off your back. If you're not doing the same by accumulating wealth with it, don't use it.
Invest and stay invested
By making the simple promise that 2020 is a year of investing, you're doing your present and future selves a big favour. The share market is often described as the biggest wealth creation engine in human history – so why wouldn't you want a slice of it? By buying shares of good companies, watching as they grow and not selling when they have the inevitable slump, you are making your money work harder for you.
Foolish takeaway
So as we start 2020, why not try some of these New Year's Resolutions that I think are easily achievable. I think your future selves will thank you if you take the very infrequent opportunity of the dawn of a new decade to make some financial changes. What have you got to lose?
