Tuesday, Dec. 29
Posted 11 a.m. EST
It's that time of year when we take personal inventory of our strengths and weaknesses and determine what requires improvement. Then, effective January 1st, we attempt to make dramatic changes to our lifestyles, whether they involve dieting, exercising more or attaining fantastic financial goals. This resolve lasts for, oh, at least a week or two. Then we slip back to our old ways.
But this year promises to be different. After all, it's not just the beginning of a new year. It's the start of a new decade.
And it appears that the financial crisis has made an indelible impact on the American psyche. According to the Commerce Department, Americans saved 4.7 percent of their disposable income both in October and November. That's up from an average annual rate of 2.7 percent over the last 10 years, according to the Wall Street Journal.
A recent survey from Putnam Investments reveals that "saving more" is the No. 1 New Year's resolution for 2010 (cited by 36 percent of respondents), followed by "exercise more" and "lose weight" (both 34 percent).
I plan to do all three. I will start by increasing my retirement savings, because success is guaranteed. I just have to notify the H.R. department that I wish to increase my regular contribution by a couple percentage points and voila -- it's a done deal. And because it's not part of my take-home pay, I won't even miss it. Use Bankrate's 401(k) savings calculator to determine your savings needs.
And the truth is, I could stand to lose some weight. That will not be easy, but I plan to reduce my intake of flour and sugar and eat more vegetables, fruit and fish. My incentive: Losing weight will improve my tennis game! Or at least it will reduce pain in my knees.
Retirement expert Bud Hebeler points out that the physics associated with reduced weight is obvious to anyone who understands dynamics. "For example, the actual load on a knee increases by a factor of two or three when walking, going down steps or running," he says. "A person who loses ten pounds may reduce the weight on a knee by 20 or 30 pounds. A person who can lose 40 pounds reduces the knee loads by 80 or 120 pounds. That's a lot on an effective bearing surface that's not much bigger than a quarter and cushioned by a piece of cartilage."
Bankrate asked readers to share their New Year Resolutions. Judge for yourself if the American psyche has changed.
Bonds are betterI plan on learning about bonds -- municipal bonds, Treasury bonds and the like. It seems like a person can get a slightly better return on their investment with bonds, especially those that are tax exempt. I'll start with the lingo and advance to purchasing when I think I've got a comfortable level of understanding. That's my New Year's resolution.
Living off the landI began a new life in 2008 by backyard gardening. I learned to can fresh veggies and fruits from the Internet and do so with everything I can get my hands on. In '09 consistent summer rains destroyed my garden. In 2010, I will construct a greenhouse to combat nature's elements. I'm doing what is necessary to live off the land. I've already bought as much gold as I could afford and transferred CDs to stronger banks, albeit with lower rates.
Mary F. Stump
Destroying debtOver the last several months, I have stopped using my one credit card. While I have been tempted ... I have been successful in only spending what I have. I have paid down that one balance so that it is half of what it was, and intend to pay the remainder off in the next six months. It requires more discipline than I thought, but it feels really great to know that soon none of my money will be going toward interest on what I spent a long time ago. Hooray!!
Why am I doing this? It just really makes sense, and frankly, it makes me make intentional choices about what I buy, or choices about how I spend the money -- like giving up some dinners out to have something for the house. This is also including a savings plan so that if I do find myself with less income, I will be OK for awhile. With less than one month's salary saved, it seems a stretch. But it is a good start!
I plan to …
- Reduce expenses.
- Pay down credit cards.
- Work harder at my blogs, eHow articles, finish the three books I'm working on and start marketing them.
- Seek more ways to increase income.
- I have totally stopped spending on nonessentials. I buy what I need, not what I want.
- I have very close to zero balances on credit cards.
- I axed both land-line phone and cable.
- I Xeriscaped the entire yard, with native plants, shrubs, bushes and perennials. This requires little or no maintenance nor watering expenses.
- I do my own yardwork -- raking, mulching and composting -- by the way, excellent exercise to boot.
Read more Boomer Bucks blogs.