Here we go, it is the time of year for reflections, looking at our lives with (or without) our loved ones gathered around us for the holidays, and decide what we want to improve about our existence.  Gyms thrive, exercise equipment sales will spike, diet programs, nicotine patch sales, etc.  Trading bad habits for better ones is the name of the New Year’s Resolution game.  So what can you do fiscally to play along?

That depends on what your habits are already, doesn’t it?  The first thing you can do is be realistic with yourself.  Are you interested enough in the marketplace to read about businesses everyday?  If the answer is no, then your road to fiscal responsibility may be easier than you thought.  Start as young as you are in investing.  Even as 18 year old college student needs to develop savings habits.  Perhaps it seems contradictory, accepting college loans, and saving at the same time, but it is the principal, as well as the growth over time, that lead to successful portfolios.  The best you can do is start now.  Decide what amount you can give up from your current budget, and start investing it for your retirement.  Many mutual fund companies will allow you to invest monthly for as little as $50/month into a retirement plan, with an automatic withdrawal from your account.  You may be able to open one on your own or with the help of a financial professional.  Fees and fund performance over time will vary, so do some research or seek help with this. 

Perhaps you answered an enthusiastic “yes” to reading about market conditions daily.  Then it is time to gather some discipline.  Individuals following the market can be like those joining the gym at the beginning of the year.  At first it is easy, and they go/read all the time.  A few weeks later, life begins to get in the way a little bit more, and six months down the road, their behavior is quite similar to what it had been.  This is just human behavior, so recognize your limits, and keep a professional manager involved.  Decide what you are going to do for research.  Read a financial paper front to cover?  Scan headlines of two or three websites and read all news about a certain sector?  Make sure you learn the basics of investing; economic fundamentals, reading balance sheets, etc. and then begin to look for bargains.  Sound investing is done by finding good companies at bargain prices, and holding them as they increase in value. 

Whatever your current habits are, they can always be “improved” simply by recognizing them for what they are and making changes as necessary.  If you think you have done a “good” job managing your own account, compare your returns over the last ten years to those of the overall stock market, or ask a financial professional to do it for you.  Resolve to determine your investment strategy and maintain it!