This year you can blossom financially, thanks to all the tips and tools available.

It’s a new day, a new year and ultimately, that means a new you.

And while that could mean eating more greens, meditating and actually reading a book this year, a resolution to give thought to is getting your money right.

Because as it turns out, owning your finances will help you do all those things.

But like anything else, you need a game plan, which isn’t a cakewalk. You’ll have questions on questions on questions which seem to have few reliable answers.

Where do you start? Should you work with an advisor or start investing in something (a la Bitcoin)? Will I even last past January 30th?

The answers to those questions won’t look the same for everyone, but there are a few money management tips that will work for just about anyone, including you.

Make Your Money Management Goals Tangible, Realistic

For starters, you need to set goals that you can actually plan for…

For instance, there’s a big difference between saying, “I want to travel” versus saying “In the summer, I want to go to Europe for a month where I’ll visit England, Sweden and Italy”.

The first statement is aimless – it’s just a general hope that you can’t really plan for. The second statement is actionable – you can actually choose flights, look at ticket prices, ideal dates to fly, check out accommodations and bookmark interesting attractions. It seems more real because you can actually do things.

And there’s a science to this. When you repeat an action, get feedback and make progress, you trigger reward circuits in your brain. You get a dopamine hit (for the non-geeky types, the “reward neurotransmitter”), which gives you the “good feels”.

But you have to commit to the habit. And that means taking repeated action, which is only possible by setting very specific goals where action can be taken.

So if you’re the type to say, “I want to pay off my debt” as your new year’s resolution, please, stop. You’re not doing yourself any favours by being so vague. Look at the numbers in your account, crunch them and then attack them specifically.

And here’s what you can say instead

  • “I want to shave off $1000 in credit card debt by February” versus “I want to pay off my credit card”
  • “I want to save $200 more every month” versus “I want to save more money this year”
  • “I want to improve my credit score by 100 points” versus “I want to improve my credit”
  • “I want to earn $500 extra a month with a new side hustle” versus “I want to earn more money this year”
  • “I want to read “Rich Dad, Poor Dad” by Robert T. Kiyosaki” versus “I want to learn more about finance”

These are goals you can actually carry out. Just picture it: you can probably see yourself transferring the money from your chequing to your credit card or selling the T-shirts you made or walking into the bookstore.

More importantly, you can plan beforehand all the little steps, tricks and habits you’ll need to carry out to accomplish those big goals.

Note: The Rich Dad, Poor Dad mention isn’t an ad or an affiliate link. But it’s one of the highest rated finance books out there and makes for a great read (*wink wink*).

Think Realistically

The other side of the coin for setting financial goals is making sure they’re doable.

Think of all the broken hearts and failed dreams of wannabe gym rats and gym bunnies worldwide. Why do they stop going to the gym after a month or so?

It’s because they try to go from couch potato to Olympic athlete in 30 days (or less). It’s sad because some of them don’t even have a solid diet or exercise to get them closer to peak fitness.

It’s no different from the folks who fall short of their finance goals. They want to pay off $15,000 of debt in two weeks – maybe because they read about someone who did it – but don’t give themselves enough time to do it. Or they’re not willing to go to the extremes that those people went in order to pay off debt in such record-breaking times.

Don’t be one of them!

Think big and think positively but don’t confuse fantasy for reality. Whatever your goals are, do the research to learn what a realistic timeframe to reach them would look like.

And remember this great quote from the man himself, Bill Gates, where he says, “People overestimate what they can do in one year, but underestimate what they can do in ten.”

We’re not saying that it will take you 10+ years to reach financial stability, but don’t expect to resolve all of your money management issues by the end of the week either (unless they’re minor). You will accomplish great things if you give it time.

Cut More than You Save

Momma taught you to save your pennies and she wasn’t wrong. But what good is it being a master miser if your habits, hobbies or (something that starts with an “h”) steal funds from your budget.

It’s like putting air into a tire that has a leak – if you don’t seal it, you’ll have to inflate it constantly.

It also doesn’t help to beat yourself up for not saving as much moolah as you’d like. Instead, focus on cutting out or at least cutting down on things you’re spending too much money on.

You’ll start to see more available funds in your accounts. This is one of the least understood and under-practiced money management tips.

Just to show you how big of a deal this is, chew on this stat: the average Canadian family spends $200 per person on groceries, with Toronto having an average requirement of $254 per person.

Whether it’s considered too high or depends on your income. But there’s no doubt that families could save money on such an expense if they look closer at their waste and how they can be self-sufficient.

That’s what Trent Hamm of The Simple Dollar hopes to accomplish this year, as mentioned in a recent post he wrote He plans to downsize his expenses with some new lifestyle choices, choices that can help you downsize your expenses as well.

Shrink the Bill

  • Kill the cable bill with Netflix, then chill – Sure, scrolling through 5,000 channels is fun, but it’s a total waste of cash if you watch almost none of them. Cut out the cable bill and pay for what you watch, with services like Netflix, Amazon or Hulu. Or at the very least, choose a cheaper package.
  • Enter DIY mode – If you can build it, why buy it? Put whatever handy skills you may have to use to make that cabinet or table that would otherwise leave your pockets dry. With that said, if you’re not confident in your skills to make certain things, don’t try it at home.
  • Grow your own groceries (a.k.a GYOG) – If you can, why not grow some of your fruits and veggies? You can eat them as they are or make sauces or entire dishes if you’re creative. Of course, don’t expect to pull this off now since it’s as cold as a freezer outside.
  • Travel with the Joneses – This hack from Trent isn’t for everyone but it’s smart nonetheless. Instead of footing the bill for an expensive getaway all by yourself, you can split the costs with another family so that you spend less. Just make sure they’re a family that you get along with.
  • Go from hoarder to vendor – Face it: those cardboard boxes sitting in the dark corners of your garage, covered in cobwebs – you’re not going to use whatever’s in them. So sell em’. Books, toys, artwork, clothes, ornaments – whatever it is you’re not using, trade it for cash. Others will treasure your trash.

There are tons of other ideas to try here, but the most important lesson is to get rid of things that you’re not using. The more we have, the more we have to lose.

So free your space and your mind of the clutter while growing your funds; what happens is that you’ll save money without even trying to save it.

Make Debts Manageable

Here’s another thing people hope for that almost never happens: they hope to pull off a Houdini with their debt. They hope that somehow, overnight, it will all vanish.

And that can certainly happen, assuming they win a Lotto 649 jackpot, discover a hidden inheritance or score a #1 hit song on the charts.

A better way for you to think is not how can I make my debts vanish, but how can I make them more manageable?

We get it – debt sucks. But just about everyone has some form of debt (even the rich folks), and it doesn’t make sense to think that you’re the only one who has outstanding balances.

Rather than having the goal of completely vaporizing debt (which is stressful and unrealistic), focus on making those debts easier to pay.

Tips for Taking the Stress Out of Debt Management

Roll all into one

Few things cause as much anxiety as knowing you have to make three, four or more debt payments. With a consolidation loan, you can combine your debts into one account, so that you’re making just one payment for several.

For example: instead of paying for two credit cards, a line of credit and personal loan separately, you can pay for them all with just one fee.

Refinance where possible

Interest, especially when it’s in the double digits, will drag out any loan or credit payment (as you well know). Now here’s a question to ask yourself: Are your interest rates too high?

Take a look at this chart below:

This chart demonstrates how big a difference interest rates make when it comes to debt.

The numbers speak louder than our words. Higher interest rates mean more debt for you both now and in the future (in this example, it’s for a mortgage).

That’s where refinancing comes into play. So let’s say you’re paying 14% on a car loan or a mortgage, you can approach the lender (or the bank) you’re dealing with, and try to get that interest rate lower.

The benefit? You pay less in the long run.

The caveat? As the chart above shows, you need a good credit score (and history of timely payments and no delinquencies) for the refinancing to happen. But of course, there are plenty of ways to improve your credit.

Get Some Assistance

You might not agree with this (at least not yet), but asking for financial advice and guidance will be probably the hardest part of your journey.  

It’s hard enough asking for help, especially if you think of handling challenges on your own. And if you’ve been labelled by others as being “bad with money”, the last thing you want is to have someone see your finances. Just the thought alone seems embarrassing.  

But a financial advisor has your back. Same with a credit counsellor. Or believe it or not, even a debt counsellor.

They’ve seen all sorts financial situations, including ones that are probably much more serious than what you face. Their job is to help you crawl out of a debt hole, not point fingers and make you feel guilty.

So here’s what you need to do: tell that harsh inner voice of yours to “shut-up”, and listen to the words of wisdom from a trusted debt professional instead. If you’re not sure where to find them, or whom to call, we have some suggestions for you below:

You’ll notice that we mentioned “financial advisors”, “debt counsellors” and “credit counsellors” as different people offering different services. And that’s because they’re not the same. Here’s the breakdown:

Financial advisor – These are ladies and gentlemen that are hopefully the first (and only) set of pros you’ll visit. They offer tons of services and advice that can get you can help you restructure your loans and increase your cash flow, without resorting to extreme solutions (see below).

Credit counsellor – These folks offer credit counselling programs, nothing else. In these programs interest rates are frozen and you make a single payment to the credit counselling agency who then transfers them over to your lenders.

Debt counsellor – Debt counsellors typically work with clients in dish for two things – bankruptcies and consumer proposals. They’re usually the last resort, but nevertheless a lifeline when debt gets out of hand.

How & where to debt counsellors/financial advisors

  • Go to the bank to speak with a financial advisor
  • Speak with a credit counsellor (if your interest rates is the reason you’re behind on payments)
  • As a last resort, speak with a debt counsellor to see if bankruptcy or consumer proposal is your best option
  • Look for online finance coaches (pay attention to their reviews)

Use Tech as a Crutch

The explosion of finance apps out there can help you manage your money and debts.

If you’ve got a phone (and if), you should turn it into a money-management too.

While updating your Candy Crush or Snapchat app, consider downloading some finance apps. There’s a great deal of them that will help you do things like:

  • Create budgets (so it’s tailored to your circumstances)
  • Keep track of your expenses (so you never ask “where’d my money go?”)
  • Keep track of finance goals (so you can see your progress)
  • Automate payments (so you never forget to pay the bills)
  • Monitor your credit profile (so you can spot errors or, *gasp* hackers)

Tech isn’t perfect, but every year it gets smarter, faster and better, and finance apps are no different. So make good use them. They can save you time, effort and best of all, money.

If you need help finding some worthwhile apps, take a look at this list to help you get started.

Accept You’ll Never Know it All

This last bit of advice can really help lift some weight off of your shoulders. That is, accepting you’ll never know all there is to finance.

The world changes, the economy changes, the market changes, your life changes.

What made sense yesterday doesn’t work today. What works today might harm your finances tomorrow. What will harm your finances tomorrow probably was advantageous yesterday. And so the cycle goes…

Even billionaire investors can make mistakes with finance (and lose big). The point of us telling you this isn’t to think pessimistically, but rather, to accept that your finance is ever-changing. Yes, some rules won’t change and should stick with you. But you DON’T have to know all there is to finance.

What matters most is doing your best to stay on top of your money and debts, making smart decisions as things change and setting your priorities straight. Because even if you go off course for a bit, you can get back on the right path.

For a Greener You

With the right money management tips, you can succeed at keeping your debts low.

Life can (and may have) put you in debt really fast. Whether it’s expenses from your holiday season, rising costs or ill-timed decisions, you can find yourself in the red.

But you’ve got a ton of tools at your disposal – professional services, fancy apps, money-saving hacks – all of which can push you to the debt-free zone.

So with all of those tools available to you, don’t let debt drag you down. Let 2018 be the year when you take your finance into your hands, and head down the path towards prosperity.

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