December isn’t only a month where folks celebrate Christmas and New Years; it is also the month many people create resolutions.  It’s the perfect time to create your personal finance resolutions for 2017.  Here are eleven resolutions to consider putting on your list!

1. Create a Realistic Budget – Many people create a budget only to see it fail.  One reason budgets fail is that they are not realistic.  For example, a person may eat out every weekday for lunch.  When they create their budget, they decide to no longer eat out and take a lunch to work.  Habits are difficult to break.  It would be more realistic to slowly reduce how often a person eats out. 

2.  Use Historical Spending as a Guide – This is easier when using a software program such as Quicken; however, Excel can be used as well, but it will take a little bit more time.  It is worth the effort, though.  There are free Excel budget workbooks on the PAFS site (here) to help you out.  Categorize your purchases over the past year in categories such as dining/eating out, clothing, medical, rent/mortgage, auto insurance, groceries, etc.  This information will show your historical spending habits.  Where do you spend most of your money?  Are there areas you can decrease spending?  Use the information you find to create your budget. 

3.  Regroup after Failing – Have you started a budget only to fail and then stopped altogether?  You are not alone!  Don’t give up, adjust the budget!  First, figure out what went wrong.  Did you make an impulse purchase?  Is your budget realistic?  Did you try to make drastic changes too fast?  Second, make any necessary changes to the budget or spending habits.  Third, try again, and again, and again until you succeed!  The ultimate failure is to give up!

4.  Read to Educate Yourself – Choose one book a quarter to read about personal finance.  One thing I have learned after all these years of studying finance is that I have so much more to learn.  Also, it helps to learn different perspectives about finance as what may work for one person, may not work for another.  For example, people who live in big cities may be able to use the public transit system for reducing costs of owning a vehicle.  However, a vehicle is necessary for those who live in rural areas where public transportation is limited or non-existent.   

5.  Use a 48-Hour Rule for Major Purchases – Using a cooling off period for major purchases is an important tool.  Have you ever made a major purchase and then regretted it within 24 hours? Or, maybe you realized after a week or so you didn’t need the product?  First, decide what constitutes a major purchase; is it $50, $100, $500, or some other number?  Then, when faced with an unplanned purchase, wait 48 hours before making the purchase.  The cooling off period removes emotional buying.   

6.  Institute Impulse Limitations for Smaller Items – It’s the little purchases that add up to big expenses.  My family of five can save $10 to $13 on drinks (depending on location) if we all get water when eating out.  Or, money can be saved if I don’t stop by the Starbucks for a drink every time I run errands.  When you find ways to limit impulse purchases of small items, it can add up to large savings!   

7.  Learn to be Thankful and Give Some Away – Learning to be thankful for what we have and giving to others helps curb spending.  When I think about my blessings, my desire for more diminishes.  Some of the money saved on impulse purchases can be given to help someone else out.  Some of the savings can be used to pay for gas to volunteer at a local food bank?  Or, some of the savings can be spent to buy some groceries for a friend in need.    

8.  Do Not Use Credit Cards as a Source of Cash – It is difficult to stop using credit cards as a source of cash.  This goal may have to be a gradual process.  Make sure to include ongoing credit card purchases into the historical spending.  If possible, remove all credit card spending.  If it’s not possible, decrease credit card spending as much as possible until you can live without using it. 

9.  Pass Personal Finance Knowledge to Kids – Pass what you are learning and know about personal finance to your kids.  The more they learn at a young age and use, the better they will do as adults.  There is so much to learn and giving them a head start should cause them less financial headaches.

10.  Shop Rates for Checking Accounts – Checking and Savings accounts can add up to a lot of fees!  It can be a hassle switching to a new financial institution, but it could mean big savings!  Shop checking and savings account rates at your local banks and credit unions to see if you can save money! 

11.  Shop Rates for Insurance – It is important to shop auto and homeowners insurance rates every couple of years.  Or, in some situations, every year.  If an accident or traffic violation has hit three or more years, you may be able to get a lower rate.  Are you looking for some quick tips for homeowners insurance?  Bryan Ochalla gives tips for homeowners insurance in his article 16 Common Homeowners Insurance Mistakes.  There is a lot of information on the internet for auto insurance.  This article, 15 Things You Need to Know About Buying Auto Insurance, by Karin Price Mueller has some helpful information.       


If you are thinking of starting off the new year trying new things, then attempt some or all these resolutions.  Personal finance is an ongoing learning experience.  Best wishes for 2017!