Tips to Keep Your 2011 Financial Resolutions

This article originally published in West Orlando News Online.

Congratulations you made it past the first week of the New Year….Now what? How do you plan to make 2011 any different than 2010 in achieving your financial goals?

We have done some research locally with some of our clients here in Central Florida and came up with our Top Financial Resolutions for 2011:



 Pay Down Debt/Spend Less on Credit (Tie)

Save More Money for the Future

Improve Credit Score

Wouldn’t you agree that far too many people, especially African-Americans have been spending more than they make because they use credit and debit cards instead of cash? This is the easiest way to lose track of where you are spending your hard earned income and falling prey to getting deeper and deeper into debt. This is exactly what the banking industry wants you to do. Last year we addressed this issue in an article called “Break the Chains of Financial Illiteracy.”

 Using plastic in place of cash maybe more convenient. But you will spend three to four times what the actual purchase price for the convenience of using a credit card. You are actually taking out a loan and agreeing to pay back the purchase price with interest. Debit cards attached to your checking account will cost you even more if you do not keep close track of what you actually deposited and what you actually spent.

Stop relying on going to the ATM and checking your balance. Did you know it was perfectly legal for the banks to falsely report what your current balance is at an ATM? Why? Because insufficient funds fees make the banks billions of dollars every year. Don’t ever forget banks are businesses. What business do you know that doesn’t want to make money? It is a good rule of thumb to keep this in mind before you use your debit card. Also ask yourself who has the best interest of how I keep track of my spending…me or the bank?

The law changed last summer when rules set by the Federal Reserve banned banks from charging Over Draft Fees, without first getting permission from the customer. You should have received a letter stating that you have the option to decline Over Draft Protection services at your bank. If you did not opt out of the overdraft protection program associated with your checking account last year, you need to do so as soon as possible.

Opting out of the Over Draft Protection Program at your bank will not only save you hundreds of dollars per year in fees, it will also help you to become more responsible with taking back control of your hard earned income. Don’t fall for the hype of saving yourself the embarrassment of going to the cash register at a store and having your debit card purchase declined because there is not enough money to cover the purchase. That’s the way it is supposed to be! How many times do you want to spend $35.00-$40.00 to purchase a $1.00 cup of coffee or a candy bar for the convenience of using your debit card? That money could be used for something your family really needs.

 Dave Ramsey ( , one of the most notable financial gurus who lost everything and went on a mission to find out how money really worked says you have to “get out of debt the same way you learned to walk—one step at a time.” He turned his spending and saving habits around when he realized that the way he handled money was the real problem that caused his financial meltdown. Have you ever asked yourself why electronic devices come with a manual on how to properly use them, but who sat down and educated the masses on how money actually works? So what you don’t know can actually keep your family drowning in debt and living pay-check-to-pay-check for ever. We believe this is the #1 reason most working class people are living one pay-check from homeless.

Well that can easily be adjusted by changing just a few spending habits, setting a few goals and have the desire to stick to them! Just remember the majority of people who have money did not get it over night. They actually sat down, evaluated their current financial circumstances, set goals and worked hard to achieve them. We also suggest families set up an Emergency Fund of at least $1,000. Not only does this put in place a safety net for unexpected events it starts the mental process to pay yourself first and may keep you from pulling out the plastic because you do not have the cash on hand. It is also a necessity towards taking the first step to gaining control of your finances.

 Here are a few tips to help you begin on your mission to work through achieving some of the financial goals listed above:

 Set a monthly budget. List your income and monthly expenses (housing, food, utilities, transportation etc.) Then keep track of what you are actually spending daily/weekly. You will be surprised when you see some of the items you purchased on impulse.

Keep a note pad in your car or in your purse and write down every time you make a purchase.

Or have an envelope handy to put every receipt for your daily/weekly purchases.

Balance your check book every week or every few days to keep tabs on exactly how much money you have until next pay day.

Determine how much you owe

How much credit cards debt?

How much do you owe on store cards?

What is the balance on your car loans, student loans, or personal loans?

Set goals you want to achieve this month (short-term) and some financial goals you would like to achieve in the next 1-3 years (long-term.)

To achieve your goals, write them down on paper. Example: I want to save at least $50 per month for my retirement.

Take your lunch to work 3-4 times per week instead of eating out every day.

This is one of the easiest goals to achieve. For instance, you work 5-days per week. Spend $5.00-$6.00 per day on lunch. That is $25.00-$30.00 per week or $100.00-$120.00 per month that you can use to help secure a better financial future for your retirement, putting more towards your child’s education or paying off some of the debt quicker.

Improving Credit Score

Make payments on time

If you are having difficulty making payments call the credit card company and work out a lower payment plan.

Although this may only be for 3-6 months or 6-12 months, it may keep you from missing a payment which may cause your score to drop. Better to have paid as agreed on your credit report than 30 days delinquent.

Check your credit report at least once a year

Challenge any errors or mistakes on your credit report.

Approximately 90% of our clients found something wrong with their credit reports when we pulled their reports. There were debts that did not belong to them, addresses or jobs they never had, even their names were misspelled.

Find out your credit score.

This is a bird’s eye view of how potential lenders and employers see your credit worthiness or how responsible you are in paying off past debts. This also impacts the interest rates offered on future loans and even what long term cell phone plan you qualify for.

How can you begin to improve your credit score if you don’t know what it is?

There are programs that not only provide your credit score, but also software that shows you how to pay off most of your debt and give you your debt freedom date!

Believe it or not the Federal Reserve’s website ( has quite a few resources for educating consumers and their children on Money and Banking which includes the pros and cons of using credit cards and debit cards. Although some of the articles and pamphlets maybe outdated, the general information is still valid information and can help consumers become more educated on how money works.

 When are you going to take control of determining your family’s financial future, if not NOW? WHEN? Almost everyone we spoke to wanted to save more for the future. But how can this be accomplished with credit card debt, multiple outstanding loan balances and too much impulse spending? What better time to put a plan into motion to take begin a new financial mindset than during the beginning of a new year?

If you feel overwhelmed on how to get started with any of your financial goals, feel free to contact Larry or Darlene Robinson for a FREE Financial Overview customized for your personal circumstances.