A New Fool
New Year's Resolutions
December 31, 1997

My resolution for 1998 is to get my articles in on time to my boss (TMF School) so that she doesn't 1) kill me, 2) fire me, or 3) make me do yucky articles about P/E ratios instead of fun ones about affording a dog.

Not surprisingly, I'm not alone in making a resolution about my job. According to a recent national survey, five of the top ten resolutions that Americans are going to make this new year have to do with their job or their money. Why do these two topics dominate our thinking? Because they are really catch-words for two other very basic desires -- freedom and opportunity.

Sometimes when we make our resolutions we loss sight of why it is we want these things. For instance, No. 3 on the list was "Stick to a Budget." OK, you say, that sounds like a responsible thing to strive for. But why? If you had all the money in the world would you still want to stick to a budget? Probably not. Doesn't "stick to a budget" really mean "use my money in the places that are most important to me?" All of the sudden, the resolution becomes something positive, a choice about the way we live our life, instead of something negative, a chore that we have to do.

Maybe buying HoHos is more important to you than paying the phone bill. Hey, that's fine. But when you think about it as a choice, instead of a rule, it becomes easier to remember that your AOL account brings you more pleasure than the little cakes do.

How about resolution no. 4: "Save More Money." Again, sounds like good advice. But if you really want to stick to your resolutions don't think about the what of it, think about the why of it. "Whats" are rules that we tend to break. "Whys" are opportunities that we want to embrace.

Instead of thinking that you should have two months' worth of expenses socked away in a savings account because that's what the financial planners say to do, try my friend Ken's approach. Think of it as "screw you" money. He knows that if things really get bad at work or if he does something incredibly lame-brained and gets fired, he will always have enough saved up so that he can walk out the door a free man.

What are his savings buying? They are paying for his peace of mind. They are paying for his freedom.

Remember, I'm not advocating that you quit your job in a huff. But how would you live your life differently if you knew, every morning when you woke up, that you did your job because you loved it, not because you needed it?

Let's look at a few more financial resolutions and see if we can't think of more productive ways to think about them.

Set financial goals. Sounds like something you dad would say, doesn't it? Sounds like something you're unlikely to do, too. You might take a stab at it, but it sounds pretty heavy-handed and serious.

Try "Make a Wish List" instead. Is your dream to buy a new house? Or to make sure that your new baby has the opportunity to be a legacy at Delta Gamma Ray? How about living on a desert island until you die? Guess what? You've just set your financial goals. Now, think about how important these things really are to you. Decide what you are willing to do to make them happen.

Pay off your debt. Again, this can sometimes sound like "somebody else getting my money." Nope, sorry. It was somebody else giving you their money. Now be a good egg and show you're a grown-up and give it back. Not only will you feel like you lived up to your obligations, but you'll now be free to start working on those wishes in the previous resolution.

Learn to invest. Oh, no, not more of those numbers and initials. Is it the 401(k) or the IRA or the SPCA that I can give $2,000 to? As anyone who's been around the Fool knows, we don't think of investing as a chore, we think of it as fun! You can, too. Hang out here and find out why. Let's start with the fact that how you invest will have a big impact on whether or not you'll get to go live on that desert island. In fact, go to the mall and buy a calendar with Cindy Crawford lying on the beach. (Calendars should be getting cheaper now!) This is the calendar that you're going to use to keep track of your savings and investments. Every time you sock a little more money away, imagine Cindy cooing, "Good boy! We're almost there."

Save for Retirement. Isn't that like, a million years away? Yes, it is. All the more reason to start planning for it now. Do you know what interest looks like when it's compounded over a million years? Seriously, you can be a millionaire. And you won't even notice it. Your employer probably has a retirement program that will take the money out of your paycheck without you even having to do anything. Take advantage of this. Before long you won't even think of it being taken out. It will just be... gone! Then once every three months you'll get a statement that says that you're now $3,000 or so richer. Take these statements and show them to Cindy. If you ever have second thoughts about putting money away for retirement remember this phrase: "I'll be a millionaire." And imagine that island.

So what are your resolutions going to be this year? And how are you going to think about them? Are they new rules to make you crazy? Or are they opportunities to live a really great life disguised as yucky rules? For more ideas on how to stick to your resolutions, don't forget to check out our 10 Foolish Resolution Tips.

--Trudy Bowen (TMF Hoyden)