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Before you start off the New Year and begin deciding what you might like to do differently in 2010, I thought I would share with you five of my favorite financial resolutions.

1. Start saving now or add to your emergency fund/financial goals by paying yourself first. The easiest way to begin a savings routine is to have money taken directly out of your paycheck either before tax with payroll deferrals for qualified savings (457, 403(b) or 401(k) plans), or after tax through direct deposit for non-qualified savings accounts. Ask your business or payroll office personnel what options you have available to you. Even $25 a pay can add up over time.
2. Coordinate savings or retirement contribution increases with salary increases. When you receive a pay increase, bump up your monthly or pay period savings amount, too. This is a painless way to build those accounts over time.
3. Don’t mortgage your future by taking loans on retirement accounts. When possible, use other assets first for dealing with unforeseen expenses. (Remember, that’s what an emergency fund is there for.) And never take a loan on your long-term retirement investments for consumer purchases, like a car or electronics equipment. The useful life of that flat screen television is only about 8 years; whereas, you may need to live off your retirement savings for 25 plus years!
4. Review your investment allocations and rebalance regularly. If you set up a supplemental retirement plan when you first started your career, it might be time to revisit the asset allocation you established with your representative to determine if it still corresponds to your current risk tolerance. And be sure to ask your representative or the customer service department if you can set up automatic rebalancing to avoid unintended risk exposure over time.
5. Stop paying for unnecessary fees and services. Review your bank statements and bills to see where and how you can do away with needless fees such as overdraft, ATM, late, etc., which instead could be going into your savings and working for you. Also, review your service contracts for items such as phone, cell, and cable, and eliminate any unused extras. Why pay for services you don’t need? Companies bundle certain services together which may or may not make sense to you, individually. Investigate whether you would save more by cutting out the ones that just add to service provider’s bottom line, instead of yours.

I’ll be spending time with my family and friends next week and will not be posting on Wednesday, so I send my warmest wishes for a Happy New Year to you and yours!