Welcome to 2012. If you are like most people, you have already comprised your resolutions (read: that list of things you say-you’re-going-to-do-but-never-actually-get-around-to) for the new year. My guess is getting your finances in order was on your list last year, and somehow it has found its way on this year’s list. Well not to worry, I’m here to help. This post is designed to help you get on track and stay on track with your financial resolutions and get your finances in order once and for all. Or for those of you who have been diligent year after year, this will serve as a refresher. We recently released our 2012 edition of “10 Ways to Turn Your 2012 Financial Resolutions Into Reality”. Hopefully you found it very informative. I’m sure you took some excellent notes and already see areas where you can begin to apply some financial prudence.
This year, I want to introduce to you a very sacred document of financial literacy, the 10 Commandments of Financial Empowerment. These commandments were created by the D.R.E.A.M. Co-Founders and lay out ten financial principles that serve as a personal guide to mastering your finances. If you diligently follow these 10 principles and apply them daily, we are confident you will achieve all of your financial goals.
Image designed by A.L.C
To get started for 2012, I have a quick exercise for you:
- Calculate what 10% of your annual income is (reference your 2011 W2 tax document). Next, calculate the annual amount you need to save by dividing that figure by 12; this number is how much you have to save each month to achieve your desired goal for the year.
- Make a list of your financial goals for this year. (The key here is to create tangible and realistic goals. For instance, if your income is $45,000 annually having a goal of saving $1 million isn’t very realistic.)
- Once the list is created, reference the commandments. See what principles apply to each of your goals and come up with a strategy to achieve these goals. For commandments that you have not covered, add those to your list and create a strategy for those.
- Every three months reference your list and see if you are on the path to achieving your financial goals for the year. If you are not, make the necessary adjustments so that by December 31st, 2012 you are successful in this endeavor.
With that, you have just taken your first steps of positive financial management for 2012, congratulations! That wasn’t too hard, was it?
Throughout the year will be posting several articles highlighting each of the ten commandments of financial empowerment, expanding on the level and insight and providing you with practical applications. I implore you to print a copy of the commandments and hang it in a visible place within your home or save it in your phone for easy access. Making solid financial decisions is a skill and must be practiced. Remember change does not occur over night; change is not an event, it’s a process. You will have to gradually alter your lifestyle, habits, but most importantly alter your understanding of your relationship with money. With this, you are taking leaps and bounds in the right direction towards mastering your finances. Good luck in 2012. May this be a prosperous year for you!
About the Author: Femi Faoye is the Co-Founder and Chief Executive Officer of D.R.E.A.M. He’s a staunch and passionate financial literacy education advocate.
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