If I could categorise all new year resolutions, they would fall into two slots: bad habits that need to be kicked and good ones that need to be cultivated.
I, for one, have been an ardent fan of the latter. At the start of every year, I diligently tell myself that I will exercise, eat healthy and donate to charity.
Come February, I would have either forgotten what I decided or just don't care enough to pursue them.
This year, I am doing the reverse. No pursuing good habits. I am going to give my undivided attention to kicking up some bad habits (and attitudes).
1. I will not let my social life overrule my finances
A discerning human being will let his finances decide where and how much he should splurge. I am far from discerning.
I don't just love to eat out, I love to eat out at all sort of places. Even those that are way beyond my budget. So what if a meal for two sets me back by a few thousands? I live just once after all.
Unfortunately, such meals don't happen just once in six months. Rather, they tend to happen around six times in one month.
And yes, I love to haunt all the pubs. Was it not Benjamin Franklin who said that there can't be good living where there is not good drinking? In normal circumstances, you will find me here every Friday and Saturday. If I am particularly happy or depressed, then thrown in another evening or two.
And I have a penchant for picking up the entire tab. I still don't know why I do it.
Need I tell you that my entertaining bill eats away most of my earnings?
Now, I plan to do the reverse. My (spare) cash will set the limits on my social life. I will decide how much I can spend each month on entertaining and stick to that.
Don't scoff. I have a plan in place.
I will open a recurring deposit with my bank and a Systematic Investment Plan with a mutual fund. This ensures that every month a fixed amount of money automatically gets debited from my bank account and directly credited to my deposit or mutual fund.
In this way, my fixed deposit amount keeps growing and every month I buy mutual fund units as the money is credited to the fund.
2. I will realise that having more than one credit card is not a status symbol
Have you ever felt great looking at your wallet and seeing five credit cards, or am I just plain stupid?
I feel important and secure knowing that I have lots of money at my disposal.
But herein lies the danger.
All my lofty plans that I have elucidated above will fall flat if I am allowed to live on money I don't have. So even if my 'entertainment budget' is just Rs 6,000, I may just succumb to using my credit card and not settling the bill at the end of the month.
I then just carry it forward at a rate of interest.
In this way, I get to continue with my bizarre social life (at least for a while till I totally drown in debt).
So here is my resolution.
No more revolving on my card. No more settling just 10% of the bill and carrying the balance forward to the next month. Pay off the entire bill every month.
And how will I manage that? Tear up all my credit cards and keep just one for emergency.
3. I will not let my girl friend rip me off
I know that sounded a bit too harsh. But I blame a fair amount of my extravagances on her.
While I am happy wearing hand-me-downs and torn jeans, she loves designer clothing (that is her weakness). Not only on her (that I would not care about) but wants my wardrobe to sport such brands too. So I tend to go overboard in an attempt to impress her (that's my weakness).
Come 2006, no more senseless splurging on Charag Din shirts and Benetton T-shirts. Now, all my designer clothes will be picked up from factory outlets and sales.
Next time I shop, I take her with me. That way, I won't need to purchase more than I require (because she hated my choice!).
And, I am going to sharpen my culinary skills. How is that going to help?
That significantly cuts down on my dinner and lunch dates with my girlfriend, where I am too chivalrous to split the bill or make her pay. Now she eats at my place and samples my cooking.
Not only will this earn me brownie points with her (how many boyfriends are this thoughtful and caring?) but even keep my money snug in my wallet, where it rightfully belongs.
4. I will realise that the stock market has nothing personal against me
How badly a stock performs after I buy it has little to do with me. Actually, it has nothing to do with me. Despite the fact that I have an inherent knack for picking up stocks that fall prey to the force of gravity soon after I buy them.
If that does not happen, their price begins to tumble when I decide to sell.
But NO! No one is out to get me. There are no sharks on Dalal Street waiting for me to make a move and then finish me.
Dabbling in stocks is dangerous. For everyone, including me. And I could lose heavily. So no getting emotionally distraught about it.
If I want to make money, I just have to stay in for the long haul and ride the highs and lows of the stock market.
So there you are, the four changes I am going to make this year. All of which I am positive will have a favourable impact on my bank balance.
Any resolutions you plan to make to save money? I would love to hear them! Who knows, I may even add them to my list.
