Take Better Control of Your Money in 2012 By Laura Royer, UF/IFAS Osceola County Extension

It’s a new year and for most it means another fresh start. This is the time of year that we all plan our New Year’s resolutions which usually include managing personal finances better. Therefore, I want to share some tips for making the most of your money in 2012.

Begin 2012 by re-evaluating your financial goals. Financial goals should identify what you want to do with your money within a given period of time. They give you a purpose and direction for the way you spend your money. Think about the things you want your money to do for you now and in the future. Be sure your goals are specific, measurable, attainable, reasonable, and have a set time frame.

Once you know what you are trying to accomplish financially, develop a plan on how you are going to spend your money and meet goals. Planned spending plays a crucial part in taking control of your finances. In your plan, categorize your spending needs and designate the amount of money that should be spent on each item. For every dollar brought home, you should have a plan for it because we are usually wondering where money not accounted for went.

Next, track your spending for the next month to determine if you are staying on track with your plan. Tracking it shows exactly what you did with each dollar and how you’re sticking with the plan. It’s easy to track the big bills or expenses, but it is always the in-between or little expenses that add up and cause the biggest leak in one’s financial boat.

After tracking your spending, go back and highlight things you could have done without and items where you spent too much money. This will help you identify spending leaks and make necessary changes for the next month’s spending plan.

Another important step is saving money. Savings should be considered a bill you owe yourself. If you’re not paying yourself first on payday, then you’re not getting paid at all. You are simply working to pay the “Bill Family.”

One reason we should save is to prepare for unexpected expenses. Evaluate your risk of encountering an unexpected expense. Most of us can guarantee that we will have unexpected expenses in the future. What are you doing now to prepare for them?

Next, power pay down any debt you have. Start by writing down all of your debt accounts including the balance, interest rate, minimum payment and the amount you can afford to pay. Pay the minimum payment on all the other accounts and pay the minimum plus any extra you can afford on the account with the highest interest. Visit www.powerpay.org to learn more about paying off debt quicker.

With tax season on the horizon consider taking advantage of programs offering free tax help. Programs include the IRS-coordinated Volunteer Income Tax Assistance (VITA) sites, Tax Counseling for the Elderly and the IRS “Free File” program. Also, beware of using "refund anticipation loans" (RALs) arranged by tax preparers. While convenient because these loans offer quick access to cash, the fees charged generally translate to very high interest rates compared with other loans. With the direct deposit, your return generally is received within two weeks.

Try to make the best use of your refund. Though it is tempting to purchase a new car or spend the money on that wide-screen plasma TV. Consider alternatives such as adding money to a savings, a retirement or college savings account. There has never been a more important time to save money or have an emergency fund than today considering our current economic conditions.

Remove money fights in relationships. Recognize that men and women view money differently, mostly because they process problems from different perspectives. Women do not rest until a problem is resolved’ whereas men compartmentalize problems and deal with them in their logical order. Communicate with each other and aim for the same financial goals. Teach your children about money.

Teach basic principles early focusing on money used to buy things they enjoy. This help kids form good habits early and can lessen the stress on the household budget because children better understand the value of money.

Lastly, it is important for you re-evaluate your financial risks. A good financial practice to sit down with your insurance agent to ensure you have the appropriate amount of life, health, car and home insurance to cover all your assets and needs. As life cycles or finances change, so does our need for insurance change.

The University of Florida-IFAS Osceola County Extension Service is offering many classes in January and February to help you New Year’s resolutions. For more information, visit http://osceola.ifas.ufl.edu.

Laura Royer is the Finance & Housing Agent for the UF/IFAS Osceola County Extension Services, she can be reached at This e-mail address is being protected from spambots. You need JavaScript enabled to view it or (321) 697-3000.