Just in time to help with your goal-setting, here is a list of 12 simple steps you can take with your money in the new year:
1. Develop a habit of saving: It’s never too early or too late to start.
2. Build a budget that aligns with your values: Think about what makes you happy and then allocate your money accordingly.
3. Create a financial plan that reflects your most cherished goals: Think of it as a roadmap to happiness.
4. Invest the maximum amount that you can for retirement: You will need more money than you think.
5. Build and maintain a diversified investment portfolio: Don’t worry about finding the “best” investment.
6. Review your spending periodically to keep yourself on track: It’s the key to living within your means.
7. When it comes to investing, avoid the crowd … and tips from well-meaning friends and relatives.
8. Understand that volatility is a normal occurrence when investing in stocks: Keep a cool head and stick to your plan.
9. Know what your money is doing—look at your investment statements at least quarterly: Ignorance is bliss, but not when it comes to your finances.
10. Insurance protects you from the unexpected: It’s just smart to have enough.
11. Choose your advisors wisely: Find people you like, trust, and who will listen to you.
12. Spend on the things and experiences that make you happy: They make life worth living.
Challenge: Choose one of the simple steps as your New Year resolution for your finances and write a short (200–250 word) essay describing how you will put it into action. In return, you will receive a 12 Simple Steps to Financial Success 2012 desktop calendar (see here), and your essay may be included in a future blog post on “Of Independent Means.”
Happy New Year!