It’s that time of year again when many of us will take pen to paper and record our infamous New Year Resolutions. What’s going on your list? Character changes? I know you’ll exercise more, eat healthy, quit smoking and spend more time with your family. Those are all very important resolutions, but you left out some crucial stuff. Sure we all want to enhance the quality of our life in "1999", but what about the quality of life down the road? If we don’t make some resolutions today to provide for tomorrow we could be flat out of luck. So here are some fiscal New Year Resolutions that you can stick to. All you need is a little money, time, patience and most important, discipline. I’ll break the resolutions down into two categories, saving and investing.

SAVING

1. If your employer offers a retirement plan, sign up for it. 401(k) or 403 (b) plans will get you in the habit of saving. Plus, your company plan may even provide a matching contribution. That’s company money going into your nest egg and you can’t beat that. Plus, you can get the triple benefit of initial tax deduction. So sign up now! It doesn’t matter if you make the minimum or the maximum contributions.

Just contribute!

2. If you’re an independent contractor like a real estate agent and the company you work for doesn’t offer a retirement plan, then you’re probably using a saving account. That’s okay, but if that account earns you less than 2%, dump it. Put the money into a certificate of deposit or a money market fund where you can yield close to 5%. While you’re at it, take a look at your checking account. Keep just enough in your checking account to cover your checks and to avoid checking charges.
3. Determine how much money you can save monthly. The rule of thumb is to put 10% of your gross income away. If you can’t do 10% then save 5%. Always pay yourself first. Don’t even take time to think about it. Quickly, deposit 10% of your commission or salary into your savings or money market fund and watch it grow.
4. Use cash instead of credit cards and pay off your credit debt. The interest on credit cards is enough to drive the same batty. Some interest on credit cards is as high as 18% a year. That’s certainly more than you’ll earn in a savings or money market fund. Stop stuffing the pockets of your credit card company. Instead, make yourself richer. Pay down your debt, stash your credit cards away and buy with cash only.

Now to investing. Sure the bull market of 1997 and for most of ’98 has many folks investing in individual stocks and or funds. But many are not. Why? Fear of the risk and the unknown. Well, fear no more. Follow these investing resolutions and you too can reap the long-term rewards.

INVESTING

1. Ask your self a series of questions to determine why you are investing. What are my investment objectives/ How much time do I have to invest? How much money will I need to invest to obtain my objectives?

Am I willing to be a long-term investor or a short-term investor? Long term investing usually means a five to ten year commitment.

2. Shop around. Look for mutual funds that don’t have high annual expenses. You want charges that are less than 1¼% a year. Many well- run diversified stock mutual funds will allow you to invest $50 or $100 monthly by signing up for their automatic investment plan. That’s a program where money is automatically withdrawn from your bank account and invested into your fund. This is a great way to pay yourself first and you won’t even feel it.
3. Do your homework. Look into no-load stocks or Drips. Drips or Direct Reinvestment Plans are offered by many companies. This plan allows investors to buy stock directly from the company with little or nothing in the way of fees. However, some companies may not allow you to buy your first shares directly from them, so you’ll have to use a broker. But, after purchasing your first shares you can buy additional shares through the company’s drip. Close to 130 companies sell shares directly to the public, including Avon and Wal-Mart. Call the company of your choice to see if they offer a Drip or surf the super highway for additional investment opportunities. One site to visit is www.oneshare.com. If you don’t have a computer or access to the internet remember that most library’s offer this service for free.
4. If you don’t feel comfortable managing your own portfolio, consider using an investment manager, broker or a discount broker. Investment managers unlike brokers manage the assets of their clients. They determine which stocks and/or bonds to purchase and they diversify the portfolios to meet the objectives of each specific client. However, managers and brokers both charge a fee. Managers have a set fee ranging from one to three percent of the managed assets. Many also have a set minimum account size ranging from one hundred thousand to one million dollars. Brokers on the other hand can purchase as little as one share for a client. Internet broker fees can run as little as $5.00 a trade. Non-internet broker fees can run up to 2 1/2% per trade. No matter who you use make sure you get what you’re paying for.

It doesn’t matter if you invest on your own or via a broker or manager. What’s important is that you invest and save for your future. The above is simply a guide to get you started. The rest is up to you. So why not start 1999 with a financial plan fit for your life.

New Year Resolution Check List

1. Make a commitment to save and invest in 1999.
2. Enroll in your company’s retirement plan.
3. Dump your saving account if it earns you less than 2%.
4. Figure out how much you can comfortably save monthly and consistently save that amount.
5. Pay off your credit card debt.
6. Buy with cash only.
7. Ask yourself a series of questions to determine your investment

objectives.

8. Look for well-managed and diversified mutual funds that charge less than 1 ¼% a year.
9. Look into companies that offer DRIP programs.
10. Interview investment managers and /or brokers.