The Fru-gal: Start the new year off with a sound financial plan

Deborah (Debbie)  Morris
Deborah (Debbie) Morris

With all the holiday madness behind us, it is time to focus on your 2014 new year financial resolutions.

Think about what you accomplished financially last year, then think about what stopped you from reaching your goals. Everyone has his/her own style of saving, budgeting, bill paying and investing. Finding your style and sticking with it will help you achieve your goals.

To get you headed in the right direction I have made a list of new year's financial resolutions, small things that can help you make better, smarter financial decisions in the coming year and in the future.

1. Make a budget. Your budget is the foundation of all your financial decisions. All you need is pen and paper. Take a look at your bank statement and tally up all your monthly bills. Seeing on paper exactly what you're spending will make it easier for you to pinpoint where you can make any adjustments.

Use technology to help you with your budget. helps build your budget while also updating your information from credit cards to bank statements.

Next make some calls to see if you can reduce any of your monthly bills. I know it sounds crazy, but try it. Call your cable company and ask them to give you a better deal. Do the same thing with your insurance agent. Call the electric company to schedule an in home audit to help you save with energy costs. For under $10 you can get window caulk or weather stripping, saving you hundreds throughout the year.

2. If you have credit card debt, put your cards away and pay with cash. When you use cash, you will spend less. It's true. And the Dave Ramsey envelope system is a great way to start an all-cash system. Label envelopes with each budget line like entertainment, food, electric, etc. put the amount of cash you have allotted for each expense in the envelope. When the envelope is empty then there is no more money for that expense. It simple philosophy.

3. Make sure you have an emergency fund. Everyone's idea of how much to stash away is different. Track all you're spending for a month, then multiply that by three. I know this sounds like a lot, but having this amount of money on hand in case of an emergency will get your through the rough spots without stress.

4. Don't forget to pay yourself. When you are paying your bills make sure you set aside some money toward your retirement or investments. Think of this as a monthly bill, making it easy to add to your budget. If your company has a 401K matching investment program, sign up for it.

5. Get healthy. You wouldn't think that getting healthier could save you money but it can. For starters, if you are a smoker, stop. Cigarettes and tobacco are expensive. Baptist Health First offers an eight-week program utilizing techniques developed by the American Lung Association. The cost is $40. For more information, call (859) 260-6419. Don't forget about daily exercising. This can save hundreds of dollars down the road by decreasing your likelihood of getting diabetes, high blood pressure, high cholesterol and heart disease. A healthier eating plan can be more economical than fast food or dining out. Brown bag your lunch, bring some healthy snacks to work and cook dinners at home. Save money with coupons plus in store loyalty cards.

6. Stop paying any additional fees. If you are late in paying your bills you are going to pay a late fee. It's best to sign up for automated bill payments. Set email or text message services from your bank to activate if your account goes below a certain amount. If you do get hit with a late fee, call customer service to ask if they will waive it. I know some of this can be overwhelming, but you will find that when you have control of your expenses you will have less stress in your life

Other money saving ideas

■ Did you receive a new iPad, tablet, kindle or any electronic device and don't have any idea how to use it? Call a librarian. Appointments are available daily to speak with a professional librarian for one-on-one assistance with their many digital resources. Call your Lexington library branch at (859) 231-5500 to learn more.

■ World Book Night is an annual celebration dedicated to spreading the love of reading. Each year on April 23, tens of thousands of volunteers give away 500,000 free World Book Night paperbacks. Those 16 or older can apply to give out 20 free books to people in their community. You will be notified in February, 2014 on the status of your application.