5 financial resolutions to make 2013 a better year

By Emma Lunn

Joining a gym, losing weight and giving up smoking may be high on your list of New Year's resolutions. But what about making sure your finances are healthy and in good shape? We asked financial experts and bloggers for their top tips for 2013.

1.  Pay off your debts
If you have a debt hangover from the festive season, the new year is the time to tackle it.  Once you've zeroed out your balances, resolve not to build them back up again.

"Pay down debts before splashing out in the January sale and shy away from those shiny new '2013 credit card offers,' " says Jay Lewis, founder of personal finance blog Sterling Effort. "And if you have credit card debt, you really should be trying to get that paid off as part of your new year's resolution. You'll feel better in the long run, trust me."

To tackle your credit card debts, make a list of how much you owe and to whom. Tackle high-interest debts first, and move existing balances to 0% balance transfer cards wherever possible.

Top balance transfer deals at the moment include the Barclaycard Platinum card (with 24 months interest free) and the MBNA Platinum card (with 22 months interest free). new-year's-resolutions

2. Plan ahead
This year, make it a point to delay gratification and wait to make a purchase until you can afford it without credit, recommends Una Farrell from debt charity StepChange.

"Don't use credit impulsively," Farrell says. "If you are thinking about using credit, consider if you could save the money first and then make the purchase later. If you do need to use credit, shop around for the best deals and plan how you are going to repay it."

3. Make the most of cash-back cards
Credit cards aren't necessarily a bad thing. If used correctly, a credit card can earn you some extra cash in the new year, says Iona Bain, who shares financial advice for young people on Iona's Young Money Blog.

"My top tip is to apply for a cash-back card to give you a flying start in the New Year," she says.

Just make sure cash-back credit cards fit your lifestyle. They may be worthwhile only if you spend a lot on your credit cards, as the amount you get back is tied to the amount you spend.

 "Also, you must commit to repayments every month or you'll be hammered by interest charges that cancel out any extra money you'd otherwise pocket," Bain says.

4. Review your cards and PINs
The new year is the perfect time for cardholders to cancel any credit cards they don't use, says Annie Shaw, a financial journalist who runs financial advice website CashQuestions.com

"They are not only a security risk -- you could lose them and not notice for a while if you aren't using them regularly -- but having a quiverful of cards could damage your chances of getting credit elsewhere," Shaw says.

Shaw also suggests having a different PIN for each of your cards.

"If a thief watches you using your card and sees you entering your PIN, you don't want him to steal your purse and plunder all your accounts. It's bad enough if you lose money from one," she says.

Worse yet, your bank may not refund the stolen money if it believes you've been careless about keeping your PIN secure.

5. Get in the savings habit
Andrew Hagger, financial commentator at MoneyComms, suggests using the near year as an excuse to get more aggressive about saving.

"As much as we want to save and know that we ought to save, the hardest part for many of us is actually getting started," he says. "So if you're serious about building a savings balance, why not put it at the top of your to-do list for the new year?"

Worried that your motivation to save will burn off by February? Set up a standing order so that money automatically goes into savings the day you get paid.

"That way it won't be sitting around in your current account tempting you to spend it," Hagger says.

See related: How to be frugal and festive: Money bloggers share their tips, Blogger Q&A: How I'm teaching my kids about money


Published: 28 December 2012