acheiving goals

You Can Make a Big Life Change: Here's How

Thursday Bram — Thu, 28 Feb 2013 10:48:36 +0000

The life you have today is not the life that you have to have tomorrow. That may sound like an oversimplification, but the truth is that we each make a choice everyday to continue to live the lives we already have; just getting out of bed each morning is a choice we make. We could always just decide to stay in bed all day.

There are plenty of reasons we don’t just stay in bed: financial obligations, personal obligations, social obligations. There are consequences that go along with the decision to change, but if you’re aware of the factors in play when you make a major change in your life, you’ll be able to deal with them. (See also: Feeling Stuck? 100 Ways to Change Your Life)

What Do You Want to Do?

There are plenty of cases of people finding themselves without a direction in life, but that’s very different than choosing to make a specific change. Your odds of actually being able to carry out a major change in your life and make it permanent are a lot better if you go in with a specific goal and plan. Consider:

What do you want to change?
Where do you want to wind up?

Be as precise as possible.

Write out a description of what you want your life to look like, perhaps going so far as to describe what you expect a typical day will be like after you make this change. If you aren’t entirely sure what your end goal is yet, you may need to do some research. You may also consider making temporary changes in your life, such as planning a sabbatical to allow yourself to experiment with alternatives.

What’s Your Current Situation?

Clearly, the change you want to make means modifying large parts of how you currently live. However, you may need to identify just what parts of your life are in play before you move forward.

Finances First

Start with the financial aspects of your life, because those are likely to be the easiest to calculate. Go through your finances and figure out what your assets and liabilities are, both overall and on a monthly basis. A lot of your monthly bills may change depending on just how you want to change your life, but you want to make sure that financial consequences won't derail you as you’re making that change.

What About Friends and Family?

Take a look at the other parts of your life. You likely have emotional obligations to friends and family that may very well be impacted by the change you want to make. These considerations are harder to calculate, but it’s even more important to make sure that you’re avoiding problems with your family as you make your change.

Write out your obligations, both formal and informal, and what you plan to do about them as you’re making a change.

What Do You Need to Transition?

At this point, you’ve got documents both showing where you are and where you want to end up. To get from one to the other, though, you need a plan. You may think you’ve got a pretty good plan in mind, but it’s worthwhile to actually write out what you’re thinking, so that you can show that you’re taking care of all your obligations on one side of the equation, as well as ensuring that you’re reaching all of your goals on the other side.

A Recipe for Change

Write out your plans like you might write out a recipe. What do you need to make the change you’re thinking about, and what are you planning to do with those resources?

You may need to go even further in depth to look at how you’re going to get your hands on the ingredients you need. But address everything you can think of. You may not be able to predict all of the pitfalls that go along with the transition you’re planning, but you can probably account for a lot of the big ones.

Your recipe will tell you how long you’ll need to take to make the transition you’re thinking about. You may not be able to make it as quickly as you’d like. You may need to build up your savings or put together other resources. But with some planning, you can ensure that making that crazy life change will go smoothly, allowing you to enjoy the end results.

Have you made a significant life change? What worked for you? What didn't?

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This article is from Thursday Bram of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

How to Do Things That Scare You

Mikey Rox — Wed, 20 Feb 2013 11:36:33 +0000

There are lots of famous quotes on the topic of facing your fears.

Here's a good one. Eleanor Roosevelt once said, "You gain strength, courage, and confidence by every experience in which you really stop to look fear in the face… The danger lies in refusing to face the fear, in not daring to come to grips with it... You must make yourself succeed every time. You must do the thing you think you cannot do."

Nice sentiment, for sure, but that's almost always easier said than done.

So, then, how does one muster the courage to step out of their comfort zone to do the things that scare them?

Instead of spitting out my sage advice (which you may not want to follow anyway because I'm deathly afraid of a lot of things), I've asked a few experts what they suggest when it comes to conquering fears. Here's what they had to say. (See also: Why You Should Do Things You're Bad At)

Enlist Support

It always helps to have a friend to lean on when you're faced with something frightening. When I do something scary — like fly on an airplane — I prefer to have a companion traveler. They provide a hand to squeeze when the plane hits a rough patch of air, and it makes me feel better that if the jet goes down, at least I won't die alone.

Although much less selfish than that personal assessment of my particular fear, Pheng Taing, author of "The Book You Shouldn't Have Read," agrees that having support when facing a fear is definitely helpful.

"The best advice on how to do things that scares you is to do it with someone who has already done it," she says. "This way you can get your feet wet, see that it's not scary and know that you have someone there for support. Once you start and keep doing it, you won't be afraid of it anymore."

Personally, while my travel buddy doesn't ease my anxiety about plummeting to the ground and crashing in a ball of fire, it certainly does feel better to have someone with me than when I fly alone. Lucky them.

Assess the Risk

Social and dating coach Nick Sparks says that one key to overcoming a fear is to assess the potential danger. Will facing this fear cause you harm? Is it illegal? Answering those initial questions (and deciding that the answers are no, hopefully!) can help ease your tension.

"If you look at others who have done this same activity," Sparks says, "you can get an idea of how much real risk you're taking versus how much perceived risk you've imagined. This lets you start to distinguish between legitimate fears and illegitimate fears, respectively."

Start Small

Another one of Sparks' tips is to ease into facing your fear by leading up to it with less daunting tasks.

For example, he says,

I work with a lot of individuals who are terrified of starting conversations with strangers. One exercise I use as a warm-up exercise is for them to speak loudly enough to passersby on the street in order to get acknowledgement, and then keep on walking without looking to follow up with conversation. This warm-up then usually makes it easier for them to initiate full conversations with strangers.

Licensed psychologist Dr. Audrey Cleary thinks Sparks is spot-on with his advice. For those with a fear of heights, for instance, she suggests learning to tolerate being at gradually higher elevations. She mentions, however, "people vary in terms of what scares them, so 'building up gradually' will look different to different people."

In other words, how you work toward facing your fear should be on your terms, no one else's.

Avoid Regret

How many times have you been too scared to do something that in hindsight you regret not doing it? I know I have.

Fear has a funny way of making you feel inferior, and that's precisely why entrepreneur coach Jeff Hellenbrand lives to face his fears head on, like joining a swim team despite a fear of water and learning how to drive a motorcycle.

What separates me from the people I know who play it safe is this: I am more afraid that I will look back on my life and think, 'well, that was disappointing.' To me, it's not about doing stupid things for the thrill, it's about getting over my fears to live the life I really want.

I can fully respect that, although, like Eleanor Roosevelt's advice, Hellenbrand's is often easier said than done — but encouraging nonetheless.

Reward Yourself

If there was ever a time to reward yourself for a job well done, it's when you've faced and overcome a fear, says lifestyle expert Maryann Reid, who — similar to Hellenbrand — was afraid of swimming in deep water but registered to become a certified scuba instructor to overcome her fear.

This is a particularly great tip because it creates an incentive for you to keep going when anxiety is at its highest (and when you're in the thick of it, it will be), and that reward may be just what you need to keep you from giving up.

Try Hypnosis

This method of fear conquering isn't for everyone, but plenty of people swear by it. I like to live by the motto, "don't knock it until you've tried it," so I certainly don't have a negative opinion about hypnosis. I'm a skeptic, for sure, but I wouldn't count it out as a last-ditch effort.

Have you conquered a major fear? How did you do it? I'd love to hear your tips and tricks in the comments below.

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This article is from Mikey Rox of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Is Peer Pressure Keeping You Poor?

Max Wong — Wed, 13 Feb 2013 11:36:33 +0000

Like every other Wise Bread writer, I hate debt. Although my debt doesn’t keep me awake at night, it is one of the things I think about while brushing my teeth every morning. “What will I do today (brush-brush) that will help me pay down (brush) my home mortgage ahead of (brush) schedule?”

The idea that “many people would rather struggle to pay off a large credit card bill than utter the phrase 'I can’t afford it,'” tests the limits of my financial imagination like a velociraptor tests an electric fence. It’s so painful, yet I can’t stop thinking about it. Spending money that you don’t have is a type of self-harm that often goes undetected and can have lifelong consequences. (See also: The Enemies of Frugality)

The Positive Power of "I Can't Afford That"

I am grateful that I figured out early on that people who judged me for saying “I can’t afford that” were the same people who were secretly living with crushing amounts of credit debt and didn’t own anything. I think most emotionally mature people realize that friends and family who make you feel bad about how much money you have are not nice people, but even armed with that knowledge, there is still so much peer pressure to spend.

One of the hardest things about not having financial parity with the people around you is turning down invitations to events that are out of your budget range. Being in debt can be isolating. In addition to missing out on weddings, nights on the town, or even schooling, friends who get turned down repeatedly might take your reluctance to spend money you don’t have as a personal rejection.

So, how do you talk about debt without losing all your friends? There must be at least a dozen ways that people manage their public spending vs. private debt, but I have four strategies that have worked for me personally.

Be Your Own Financial Cruise Director

Your debt is not your friends' problem to solve.

While your truly good friends will always listen to you complain about your financial woes, it’s not really up to them to make your life without money work. If you want to spend time with people you care about, suggest alternate, inexpensive ways of spending time with them:

If you can’t afford to go to a $10 gym class, suggest a morning hike or a run through the park to your sporty friends.
If you can’t afford dinner, ask to meet with your friends after dinner for a drink instead.

When I was really poor, I became the master social planner for everyone in my life because I would comb the weekly alternative newspaper for free concerts, book readings, art openings, and other events that I could invite my friends to.

Even if you live in a tiny town with no nightlife, there are plenty of free ways to spend time with your friends. For example, offer to go with them when they have to run all their boring errands. Or, hang out with them at school events for their kids. Do yourselves both a favor and schedule a cleaning day where you switch off helping each other clean your houses. Chores go faster when you have a friend to talk to.

Be Honest

First, be honest with yourself. Use a debt calculator to figure out how long it will take you to pay off your debt with what you are currently paying.

Once you’ve established your baseline, experiment with the calculator to see how fast you can pay down your debt if you just pay just 5% more than you are currently spending.

Once you know how little money it takes to cut YEARS off your debt, try to figure out what amount of money you can cut out of your budget and throw at your debt.

Do you have good public transportation in your town? Would it be worth it to stop driving your car for a year if it meant you could pay down a credit card debt in the same amount of time?
Would people at your office still be your friends if you stopped going on Starbucks runs with them every day and instead baked a homemade cake once a week to share with them in the lunch room? Would they still be your friends if you just escorted them to Starbucks and didn’t order anything yourself?

Second, be honest with your friends. Put on your adult pants and just be out about your budget parameters.

The economy is crappy, so most people are actually in the same boat. In addition to saving yourself from friendship-ending misunderstandings, being honest about your finances can actually lead to finding extra work. Most people do live lives of quiet desperation, and those people are not the ones who get recommended for jobs. I am very loud about my life of desperation, and consequently I’ve always had odd jobs come my way. No reasonable person can fault you for wanting to sock away more cash during a recession, and you might as well reap the rewards of talking about yourself.

Decide What You Really Want

Nothing is more depressing than not being able to afford something you really want because all your money is going to pay down credit debt. That said, if you earned an extra $100 per month this year that didn’t have to go for bills, what would you spend it on?

When I was still in college, I decided that I wanted to buy a house by the time I turned 30. Every time someone pressured me to spend money I didn’t have I would say, “I’m sorry, I can’t afford that because I’m saving up to buy a house.” That really shut people up because people can understand the desire and expense of homeownership. Also, by having that goal, it was so much easier to not feel deprived because I would just ask myself, “Do I want this cocktail, pair of shoes, theater ticket, whatever more than I want a house?”

So what do you really want? The kids in private school? A vacation? The ability to eat sushi three times a week? People are a helper species. If you commit to a personal goal, even random strangers will root for you to achieve it.

Find People Who Will Reinforce Good Spending Habits

Ultimately, how you spend money is your responsibility. Are the people who are pressuring you to spend money going to apply the same amount of attention to helping you get out of debt? If the answer is no, find some people who share your financial needs and desire to get out of debt.

A recent Harvard Business School field study tested the effects of self-help peer groups on micro-entrepreneurs in Chile. The paper’s authors discovered that participating in self-help style groups helped the micro-entrepreneurs almost double their savings.

The Harvard researchers also discovered that similar effects can be achieved by holding people accountable through feedback like text messaging. Luckily, you don’t have to be a Chilean micro-entrepreneur to get online feedback. ING’s CompareMe tool allows people to plug in their age, income, and hobbies and see how their retirement savings and their debt stack up.

Do you work better with a buddy? Most people do. If you can’t find a friend or family member who wants to commit to a savings challenge with you, recruit someone who lives near you. Likely candidates include anyone who attends a Dave Ramsey seminar or any adult education class on personal finances or Simple Living. Alternately, you could always start your own savings group online, where you can get advice and support from people who are actively looking to spend less and save more.

Do you feel peer pressure to spend money you don’t have? What do you think about it? What do you do about it?

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This article is from Max Wong of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Trade Goals for Values

Craig Ford — Fri, 11 Jan 2013 10:48:39 +0000

We are a goal-driven and goal-oriented society; we've been taught to believe that only good things come to those who set goals. Every New Year, those who want a better future get out a pen and paper and set realistic and measurable goals.

While there is a time and place for some types of goals, there is also value in living a goal-less life. Perhaps you've participated the New Year "set and fail cycle" before — set a goal, don't reach your goal, and feel guilty. Promise to do better next year. For many people, goal setting leads to frustration, guilt, and feelings of inadequacy.

The solution? Exploring and clarifying your values instead of setting measurable goals. Not having goals is not the same as lacking direction. Goals come from our values, calling, or bent in life. We all consciously or subconsciously have a destination to which we are traveling.

Goal setting is our attempt to break those bigger vision items into smaller and more manageable sections and segments. (See also: Goal Setting: Defined and Deconstructed)

The Problem: Setting the Wrong Goals

The problem is that we're not usually very good at setting goals that really focus the direction of our life. In 2011, I had the goal of writing a book. I did write that book (The Secret to a Successful Budget), but I also sacrificed a lot of valuable things along the way.

Goals give us such intense focus that it's quite possible that we put on blinders to the things that bring our lives true meaning and true joy. Life is so fluid and unpredictable that perhaps we're better off accepting events as they come rather than trying to control the outcome of a year.

Determining Values Instead of Goals

What if, instead of setting goals, you simply acknowledged your values?

For example, in 2012, I determined that relationships were important to me. As a result, my focus was on maximizing the opportunities I had to spend with friends and family.

The result was that I took three months off and traveled with my wife and kids. I'd take days off work to go and visit friends who happened to be passing through town. Our family attempted to say “yes” whenever we had the opportunity to be with friends or family.

Life is so fluid, so transient, and so fleeting that goals can easily become obsolete or a distraction.

So, what do you value?

If you value fitness and health, then you'll be looking for opportunities to explore and improve your fitness level. Instead of staying, "I'm going to exercise for 30 minutes four mornings a week," you could just simply decide to exercise when given an opportunity. Sometimes that may be in the morning, and sometimes that will be in the afternoon. At times you might feel like an hour run and on other occasions you might rather do a 20 minute workout video.

If you truly value something, it will find expression in your activity — with or without goals.

Let Goals Flow From Your Values

I'm a person who seeks to conform my life with my faith. Thus, honoring God is one of my values. Sometimes I never know how that will express itself at any given time. However, there could easily be a knock at the door or a chance meeting that causes me to do something in light of my faith.

While goals narrow your view, values broaden them. Values allow you to ask if an unpredicted event conforms to your values. How would a person who values family respond in this situation? How would a person who values faith respond in this situation?

Does This Mean You Shouldn't Set Specific Productivity Goals?

The answer depends on your temperament. In life, events often conflict with your goals. That could lead to frustration and disappointment. If you have a habit of failing at goals and the emotional results are negative, then try skipping goals entirely. This might not be a lifelong change, but an experiment in value-oriented living.

As an example, let's return to a discussion about fitness.

A goal says that you'll exercise for 30 minutes every morning at 7 a.m.

While you can value health and fitness, you can also decide that an unexpected activity should trump your workout schedule. As an example, when I'm traveling with family, I often don't exercise.

Why?

During family travels, you're likely out of your normal schedule. With two values (spending time with family and fitness), you may need to decide to do only one of the two. One of the problems with goals is that they can often conflict with each other, forcing you to do too much or causing you to feel guilty. However, value-based decisions recognize the fluidity of life and allow you to make an adjustment based on your circumstances.

Goals work in a rigid life context, but they provide less value when your life is full of change, transition, and pattern-less living.

Instead of setting new goals in 2013, try evaluating your values, and live a value-focused life instead of a goal-driven life.

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This article is from Craig Ford of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

7 Ways to Ace Your Next Performance Review

Paul Michael — Wed, 09 Jan 2013 10:48:38 +0000

For the most part performance appraisals are a lot of puffery, smoke and mirrors. They are done in a certain way, using certain guidelines, to keep the HR department compliant and to make sure everyone is relatively happy.

But at their core is something important. These reviews give you a chance to hit the reset button on some issues, and also air a few legitimate grievances. They are a way to show your real value to the company, and to highlight major achievements from the past year. So, if you have a performance review looming on the horizon, keep these seven quick tips in mind and be ready for the best one-on-one with your boss you’ve had all year. (See also: I Hate My Job! Now What?)

1. Know the Process Inside and Out

If you’ve ever watched the UK show “The Office” (one of the best comedy shows ever, by the way), you may remember the hysterical performance reviews. One in particular, between Keith and David Brent, showed the employee’s complete lack of interest, or knowledge, about the whole procedure. It did not go well. That’s comedy, but reality isn’t so far from that truth. Make sure you know how the forms work, know what needs to be filled in, ask questions to HR if you have them, and do a dry run. You don’t want to hand over something with spelling errors, crossed out words, and bad grammar.

2. Have Every Single Duck in a Row

If you’re about to sing a song about your worth to the company and your desire for a raise or promotion, you need more than a charming personality to back it up. Bring printouts of projects that you excelled in. If you got emails thanking you for a tremendous effort, bring those, too. And, do the research on your salary. If you’re currently making $45k a year, but Salary.com says you should be more in the $55-60k range, bring the evidence. It’s hard to argue with that facts.

3. Come With Questions

It’s been a year (hopefully) since your last performance review. In that time, questions should naturally have arisen that you need to ask. Well, now is the time to ask them. Why did you get passed over for a promotion or supervising role? Why did someone else get the project you were hoping for? Why were you excluded from meetings that you felt required your presence? And so on. It’s time for straight talk, and you deserve straight answers.

4. Address What Went Wrong

Was there a complete catastrophe at work? Did a client walk out of the door? Did a machine sputter and die due to something you were involved in? Did money go missing, and it cannot be explained?

Well, you need to explain it. All of it. You don’t want a black mark on your record because you could not prove you were not responsible for something bad that happened. And if you were, now is the time to explain exactly why, and how, things went wrong and what you’ve done to make sure it doesn’t go wrong again. Situations that escalate out of your control need to be explained. At the end of the day, bad things happen at work, but people rarely do them maliciously. You just need to make sure your employer knows that

5. Highlight Your Accomplishments

Now is not the time to be bashful or sit back and let others take credit. It's your review, you’re under the spotlight, and you deserve the accolades.

If you were a major participant in a big project, blow your own trumpet loud and clear. If you took the lead on a project, say so. If you spearheaded a major change within the company, let it be known that you were the one carrying the load. It’s time to get what you deserve, and you need to make it known loud and clear.

6. Take Detailed Notes or Record the Interview

I say this because it has happened to me on more than one occasion — things have been said, and promised, in performance reviews that did not come to fruition afterwards. I have been offered raises and promotions that were not forthcoming. I did not take notes or record conversations (ask permission to do this, but there should be no reason not to let you) and I did not sign anything in those reviews. Long story short, it was my word against the manager’s, and the manager had more clout than I did. Ideally, you could write down facts during the meeting, such as any promised raises, bonuses or promotions, and then have your manager sign your notes. That way, you are completely covered if things take a turn.

7. Bring Up Your Goals for the Future

Finally, what do you want out of your current, or future, role at the company? What would make you happy professionally? What courses do you want to take to grow in your chosen career? Do you want to travel more (or at all)? Do you want to work with other departments or expand your reach creatively? Do you want to be a key player on certain projects?

Goals are very important for performance reviews, as they set milestones for both you AND your company to reach. If you want to be better at your job, it will take the company’s help as well. And this is the perfect time to strike that bargain and find a way for you to improve. As you improve, the company benefits, too.

Those are my seven quick tips on how to ace that performance review. If you have more, feel free to let us all know in comments.

This article is from Paul Michael of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Checking in With Old Goals for the New Year

Mikey Rox — Mon, 31 Dec 2012 10:48:39 +0000

It’s time to make those New Year's resolutions. But before you start scribbling a list to stick to the fridge, I thought it would be a good idea to check in on last year’s goals. I’ve chosen eight of the most popular that you’ve inevitably broken by now to offer my advice on how to give it another go in 2013 — and actually follow through. Good luck, and Happy New Year! (See also: 4 Tips for Making Resolutions Stick in the New Year)

1. Eat Healthier

We all want to eat healthier, but it can be almost impossible if you don’t have a plan. Rising food costs can be prohibitive, for sure, but I find that it’s mostly my own busy-ness (and laziness, at times) that contributes to my poor eating habits.

In order to stick to a regime of healthy food consumption more often than not, I started creating a monthly meal calendar using recipes I found online or in magazines. For each day of the workweek, I listed a main course and one or two healthy side dishes. I left the weekends open just in case a weeknight meal was skipped due to an event or other obligation that popped up, and I included one maybe-not-so-good-for-me meal on the list as a reward for sticking to the plan. With this new outlook on healthy eating, I find myself not only making better-for-my-body meals, but I often have healthy leftovers for lunch, and I’m saving more money with a rigid grocery list of ingredients than I did without the plan in place. I definitely plan to keep this in place in the New Year, and I encourage you to try this out as well.

2. Quit Smoking

This has been my resolution for many years — and it will be one of my resolutions again in 2013. In my defense, I’m getting closer to completely kicking the habit, I think, because I’ve decided to enlist the help of smoking cessation aids like an e-cig and medication. I certainly don’t want to replace one habit with another, but if these devices can assist my efforts to quit, I’m all for it.

If you’re in the same position, don’t beat yourself up about it. You’ll quit when you’re ready, but there’s no harm in trying again on Jan. 1. To get ready, mark your calendar with the date you plan to quit so you can mentally prepare. When that day comes, use whatever you need to use to stay away from the cigarettes — whether it’s a doctor-prescribed medicine, an electronic cigarette, or a support group (or maybe all three). You’ll get there soon enough — just stick with the program.

3. Workout More

One of the ways I was able to stay on track with a workout routine was to shake it up. Early last year, I canceled my gym membership and started buying one- to three-month short-term memberships to local gyms via daily-deal services like Groupon and LivingSocial. It worked. I went to the gym much more often than the previous year, in part because of the urgency of the deals (they expire, after all) and because of the constant change of scenery. The other plus side to my new way of working out is that I save about $40 a month on the short-term memberships than I did paying for the membership for which I was being billed every month.

4. Drink Less

What can I say? I love my vices. It seems that many of us do, in fact, since this is a perennial resolution. I still drink, but I did cut my drinking down in 2012 by limiting the situations that focused on drinking (fewer parties and after-work happy hours) and adding more active-living activities (more time in the gym, concentrating on projects, or cooking and baking) to reduce my desire and available time to pop into my neighborhood watering hole. I also refrained from bringing booze into the house on a regular basis, only picking up wine or beer for a special occasion. Even though I cut back this year, I’d like to cut back a little more next year, perhaps setting a goal of only one bottle of wine per week. Fingers crossed.

5. Get Out of Debt/Save Money

Unless money is not a concern of yours, paying down your debt and boosting your savings is probably on your list of resolutions. But to complete a goal, you have to make an achievable one opposed to a lofty one built on a board concept. For instance, my goal this year is to put $500 a month into savings. After I pay all my normal living expenses, this won’t always be easy — which means that I’ll have to cut back in some areas — but it’s achievable given my personal income and budget. The trick that I’m employing here is in assigning a real number to what I’d like to save per month. Just saying that I want to “save money” makes the goal vulnerable to being broken. Rather, I’ll have this number in my head every month so I’m more apt to hold myself accountable — if only so I don’t make myself feel guilty for unnecessarily failing because I didn’t try hard enough.

6. Learn Something New

This is one of the easiest resolutions you can make — and it’s totally easy to keep, too — you have all year to accomplish it after all. My goal in this area isn’t really learning something new but rather being better at something I already know — speaking Spanish. I studied the language for 11 years (it was my minor in college), and I’m decent at it, but I’m nowhere near the fluent speaker I’d like to be. In 2013, I plan to pick up language learning software and brush up on my skills. Perhaps I’ll even reward myself at the end of next year with a trip to a Spanish-speaking country. Now that’s incentive!

7. Spend More Time With Family

Another easy resolution, I think, if you can put an achievable plan in place. First, however, think about why you feel like you’re not spending enough time with your family. Are there obstacles in the way? Are you working too much? Are they too far away? Focus on fixing those problems first, then put a plan in place — say, allotting one Saturday per month to giving your family your undivided attention or participating in an outside activity with them.

8. Enjoy Life More

To achieve any of your new goals, it’s important that you’re happy with the quality of your life; if there are issues and obstacles preventing you from being happy, work toward removing or remedying these situations. When the worry and frustration is removed, you’ll find that you’ll have an easier time enjoying life. Of course, that may mean concentrating harder on the other resolutions on your list and seeing them through, but nobody said it would be easy.

What were some of your resolutions for 2012? Were they a success? How did you achieve them? If you didn’t meet your goals, why do you think you failed and how will you approach your new resolutions in 2013? Let me know in the comments below.

This article is from Mikey Rox of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

4 Tips for Making Resolutions Stick in the New Year

Tara Struyk — Thu, 27 Dec 2012 11:36:30 +0000

New Year’s resolutions have become a bit of a cliché, especially when you consider the statistics — according to a 2002 study published in the Journal of Clinical Psychology, only 19% of people who make resolutions are still sticking to them after two years. So what’s the point?

As much as I cling to the cynical view, I’m all for resolutions for one simple reason — results. Resolutions really work, and I’m not just speaking anecdotally. Among the people who make resolutions in a typical year, 46% keep them for at least six months, compared to only 4% of a comparable group of people who wanted to make changes and thought about doing so, but stopped short of actually making that commitment. In other words, the power of a New Year’s resolution may not be so much in how you make it or what you resolve to do, but whether you actually make a resolution at all.

Pretty cool, huh? There is one snag, though — most of us don’t know what a resolution really is. (See also: Why Your Big New Year's Resolutions Are Pointless)

Remember: Resolutions Aren’t Goals

Setting a concrete goal to work towards during the year is a valuable exercise. After all, it could be the impetus you need to push you to do something you’ve always wanted to do, like run a marathon, travel, or finally start putting some effort into retirement savings. But while many people resolve to do very specific things (losing weight, quitting smoking, and exercising more regularly top the list), those aren’t really resolutions.

They’re goals.

What’s the difference? Well, a resolution is the act of resolving or determining on a course of action, but the word also implies a sense of firmness of purpose, of being resolute. In other words, while a goal is something that you work on until it is complete, a resolution is better thought of as something that you must live, day in and day out.

With that in mind, here are some ways to make better changes in the New Year. And by that I mean changes you’ll be able to make continued progress on for years to come.

1. Stop Trying to Make the Right Resolution

When I make resolutions, I often find myself torn between resolving to do something I feel like I should do and choosing a more personal resolution that really resonates with me. Maybe you feel like you should lose weight, or your family is bugging you to quit smoking. Those are great goals to set, but if they aren’t in line with what you want, I’d be willing to bet you won’t succeed — at least not for long.

Instead of trying to make the right resolution, focus on making one that’s right for you. Try thinking about the things you did that made you feel proud and happy during the year, and the things you regret. Then come up with a resolution that’ll help you embrace more of the good and less of the bad. Now that’s progress, especially if you continue to do this year in and year out.

2. Do It Every Day

Gretchen Rubin, author of “The Happiness Project,” often writes about the power of doing something every day, even if it’s only for a few moments.

“If I try to do something four days a week, I spend a lot of time arguing with myself about whether today is the day, or tomorrow, or the next day; did the week start on Sunday or Monday; etc.,” she wrote in a 2009 blog post. “The things you do every day take on a certain beauty, and provide a kind of invisible architecture to daily life.”

An invisible architecture. If you think about your life that way, the things you do every day, the things you resolve to be a priority, the things you get so used to doing that you do them without question, could be considered the very foundation and framework of your life.

When it comes to what you do every day, resolve to add things that improve that structure, such as making healthy choices, spending time with your family, or finding time for yourself. We breathe every day, we eat, we sleep. Those are essential. When it comes to the other stuff, there’s some wiggle room. Even so, what you choose to fill the rest of the time with should be what matters most to you.

3. Try, but Don't Succeed

A year is a long time, and often, situations we don’t anticipate make keeping a resolution difficult. I often find myself basking in the glow of a little time off around Christmas and resolving to be more patient or, perhaps more specifically, less totally impatient. But once I’m up against a little more stress and a little less sleep, I sometimes snap under the pressure (and ultimately snap at someone).

Change is hard, but if there’s anything harder than changing our ways it has to be our failed attempts. Fortunately, a Stanford psychologist has found some evidence that failure is actually a performance enhancer.

According to research by Carol Dweck, people who saw ability as something that could be developed were able to make huge strides in just about anything they set their minds to, while those who chose to feel helpless about their lack of ability failed to progress. The difference is largely one of perspective. Do you see your resolutions as something you need to complete and check off your list, or as a work in progress that you can continue to perfect over time? I’m going with the latter. At least that way, there’s hope for me yet.

4. Start Small, Live Large

Maybe you’ve resolved to live healthier or be happier, but whatever big ambitions you have in life, start small. (After all, if a resolution is something you live every day of your life, you have time!) Start chipping away at your resolution by choosing something you will absolutely be able to achieve. Once you have that down, add something else. This won’t deliver the dramatic, ugly-duckling-to-beautiful-swan type transformation we all sort of fantasize about. The thing is, I think we all recognize that most of those fantasies just aren’t very realistic. So take little steps toward to your big ambitions. Over time, you will achieve something tangible that you can proud of.

I’m not sure what resolutions I’ll make this year, but I’m always aiming to live a life that’s happier, healthier and more in line with what I believe is important. As a result, I look forward to making a resolution of some sort. When it comes to health and happiness, there is no destination. But when you think about it, that’s actually a good thing.

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This article is from Tara Struyk of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

25 Things to Do Before the New Year

Mikey Rox — Tue, 11 Dec 2012 11:00:33 +0000

Before you know it another year will have passed and we’ll be on to 2013. In anticipation of that eagerly awaited fresh start, I thought it pertinent to remind you of a few loose ends you might want to take care of so you can kick off January 1 with a clean slate. To help you stay on track, here are 25 things you should do before the New Year. (See also: 25 New Things to Do Today)

1. Do a Deep Clean of Your Home

Many of us do a spring clean, but our homes could probably use concentrated TLC more than once a year. So you can tackle all the problems areas head on, I’ve written this check list on how to clean your home in the fall.

2. Concentrate on Unfinished Projects

You know that project you were excited about for a couple days then pushed to wayside for any number of reasons? Revisit it and finish it so you can enjoy a sense of accomplishment and have peace of mind before the year ends.

3. Make Last-Minute Donations to Boost Your Tax Deductions

Round up anything you don’t want anymore, and send it off to an organization that can put it to better use. Look under the bed and in the attic, rummage through the garage and basement, and pull things out of your closet that you no longer want or need, giving them to a good cause so you can write the donation off later.

4. Plan Meals Based on What’s Already in Your Fridge and Pantry

Instead of going grocery shopping for the last month of the year, make a list of ingredients using what’s already in your fridge and pantry and plan meals based on what you have. You’ll save money and get rid of foods that will expire if you leave them in there too long.

5. Reconnect With a Friend With Whom You’ve Lost Touch

Most of us are well-meaning people, but sometimes life gets in the way. If you’ve lost touch with a friend or family member this year (or for a few years even), give them a call or send an e-mail to reestablish the connection.

6. Clean Out Your E-mail Inbox and Folders

Follow-up on unanswered e-mails, delete expired messages, and otherwise organize your e-mail and its folders to make life a little easier on yourself when it’s time to get back to work.

7. Get Your Receipts Together to Start Preparing Your Taxes

As soon as the New Year starts, I’m ready to go to the tax guy. My taxes are usually filed by the end of February because of this proactive procedure. It’s a huge burden lifted. Get busy now to save yourself a lot of stress later.

8. Schedule a Physical With Your Doctor

If it’s been a while since your last checkup, get to the doctor to make sure all is well.

9. Go to the Dentist for a Checkup

I know, I know – nobody likes the dentist. But it’s important to take care of your chompers on a regular basis. If you’ve skipped a couple cleanings, get to the dentist as soon as possible.

10. Hit the After-Holiday Sales to Stock Up for Next Year

This is one of my favorite activities! After Christmas has gone for another year, hit up your favorite discount department store to stock up on wrapping paper, gift bags, and all manner of holiday paraphernalia at big savings.

11. Make Short-Term New Year’s Goals

Notice I didn’t call these “resolutions.” The reason for that is because resolutions are a waste of time because we think too big when making them. Instead, think about smaller, reasonably attainable goals to concentrate on in the new year. I promise you’ll have more success in achieving them than those lofty goals you’ve made in the past.

12. Host a Holiday Party to Spread the Good Cheer

Get everybody together for one last hurrah before getting back to the grind.

13. Cut the Clutter in Your Home by Selling Unwanted Items Online

This is never a bad idea, but it’s very useful this time of year to help offset the cost of the holidays. Sells old books, DVDs, clothes, electronics, appliances – really anything that you think someone else could use – to earn a bit of extra income as the year comes to a close.

14. Update Your Resume Just in Case

You never know what can happen in the blink of an eye, so it’s best to be ready. Update your resume and bio so you can start looking for a new job if you lose the one you have or so you can start the New Year hitting the ground running in the search for a better job.

15. Change the Oil in Your Vehicle

Every six months or 3,000 miles. If you’re past due, get to the mechanic now.

16. Go on a Mini-Vacation

The holidays can take a toll on your sanity — I know that better than anyone. If you’re at your wit’s end, take a few days off by taking a mini-vacation in a nearby, inexpensive place where nobody knows your name.

17. Use Up About-to-Expire Daily Deal Coupons

I have more deals than I have time, so I plan to concentrate on using them up instead of spending more money before ringing in 2013.

18. Start a New Exercise Routine

A lot of people plan to start exercising Jan. 1 or shortly thereafter, but why not get a head start? Start your new exercise routine now so you’re already in the thick of it when the new year begins.

19. Create a Monthly Meal Plan for January

I started doing this a few months ago, and it’s been a blessing for my health and wallet. This December, sit down and create a monthly meal plan — at least for dinner — so you know what you’re eating every night of the week. It’s really incredible how much healthier your eating habits become when your meals are on paper.

20. Complete Small Home-Improvement Projects

By small, I mean change burnt-out light bulbs, tossing out dead plants, washing the windows, etc. Ya know, those things you’ve been meaning to do but keep putting off.

21. Update and Consolidate Your Contacts

There’s no better time of year than holiday time to update your contacts — especially if you plan to send out cards or host a party. Your workload will be all the much easier than trying to do it in piece meal.

22. Revamp Your Budget to Save More Money

Sit down and evaluate your financial situation. If you spent too much this year or didn’t save enough (not always one in the same, mind you), make a plan to cut out some expenses you can live without and implement strategies to save more money along the way.

23. Clean Up Your TiVo

My TiVo is clogged with all kinds of content I thought I wanted to watch, but really don’t. If you’re like me, get rid of the junk. Mid-season replacements are coming anyway — so you’ll need the extra room.

24. Make Provisions for a Disaster or Other Emergency

Let Hurricane Sandy be a lesson to us all. Turns out we’re not prepared for impending disaster. To make a terrible situation like that a little more bearable when it strikes, start stocking up on disaster supplies now so you’re not left scrambling (or worse, up the proverbial creek without a paddle) when the "ish" hits the fan.

25. Count Your Loose Change, and Deposit It Into Your Savings

Have a jar of coins you’ve been keeping all year long? Count it out, wrap it up, and deposit it into your savings account. You’ll be surprised at how much is in there. Doesn’t look like much, but it adds up quickly.

Have any ideas to add to this list of things you should do before the New Year? Let me know in the comments below.

This article is from Mikey Rox of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

A 5-Step Plan to Quitting Your Job

Carlos Portocarrero — Wed, 05 Dec 2012 11:24:32 +0000

That all-too familiar dread is starting to consume you more and more every day. Sundays have become even more depressing than normal. Lunch hours are a godsend even if you're not eating.

It's time for you to get out of there. It's time to quit your job.

Here's the right way to do it so you don't burn any bridges and set yourself up for success. (See also: How to Quit Your Job)

1. Start a Journal

Take a long look at all the reasons why you want to quit and write them all down. Not just once, but over time.

Don’t get too Kumbaya about this; the goal isn’t a thorough psychological checkup about why you want to quit or what it means in the grand scheme of things.

The goal is to just keep track of how you’re feeling and what's making you feel that way. It can help keep you focused and might even help you the next time you have to leave a job. We always forget how we felt and why we did the things we did, but if you have it down on paper, it’ll be easy to remember your reasons for quitting.

Hopefully these thoughts will keep you from falling into a similar situation in the future.

And who knows — you may find that it isn't your job that's actually filling you with dread and you don't have to quit to solve the problem.

Action item: Start a Google Doc entitled “Why I’m Quitting” and write a few sentences at least twice a week about the things that make you want to leave and what you’d like to change.

2. Test the Waters

Before you do anything rash, it's important to get a sense for what's out there and start to prepare the world for the awesomeness that is you.

Pump up your LinkedIn profile, make sure a Google search doesn't bring up anything embarrassing, and check out the job boards to see what’s out there.

Now’s the time to reach out to former coworkers to get recommendations (on LinkedIn, or check if they’re willing to be contacted via phone by prospective employers) and to get the word out that you’re looking to make a move.

It’s amazing to me how many doors open up when you just let people know what it is you’re trying to do. I’ve had distant connections I hadn’t talked to in years volunteer to introduce me to important people in key companies.

Talk to your significant other/spouse as well...you don’t want to surprise them by suddenly announcing that you’re going on an interview (or that you’ve already quit!) when they have no idea you wanted to leave your job. It’ll save you from at-home drama during a very hectic time.

I wouldn’t recommend talking to anyone you work with about it, but if you really trust them (and they probably want to leave too), then this can be a great motivator.

The goal during this step is to get a sense of what's available, preparing for a move, and get as much help as possible in finding new leads.

Action item: Email people you trust (a mass email is fine) briefly explaining your situation and asking them if they know of any open roles you’d be a good fit for. Also include a link to your LinkedIn profile and ask for a quick recommendation.

3. Outline Your Plan

Now that you have a sense of what's out there, it's time to put together a plan of action.

You don’t necessarily have to have another job lined up (though I’d really recommend you do), but you absolutely must have a plan.

Financially, I wouldn’t just quit. No matter how much you hate it, I’d advise you to figure out a way to make it bearable enough that you can find a new job before you quit.

If you’re so miserable that you feel you can’t stay a moment longer, then the next step will become even more important.

Your plan should be as detailed as possible; it’s the map you’ll follow to find your next gig — one that you’ll be happy and feel rewarded for a long time (ideally).

Action item: Start a new Google Doc titled “Master Plan” and write three tasks, each with three bulleted items below them. Each one is something you need to do and the bullets are how you’re going to achieve them. Good ones to start with: Find new job, expand my network, pump up my resume, get an interview, etc.

4. Review Your Books

Money is a crucial part of why we work and what we decide to do for a living. So if you haven’t reviewed your finances in a while, please do that ASAP. I always recommend Mint.com to easily keep track of all your income and expenses. (Unfamiliar? Check out 8 Cool Mint Tools for Managing Your Money.)

If you’re going to quit your job, you should have a new one waiting for you (remember the Outline Your Plan part?) or have the money to carry you through a period of not having any (or lower) income. Don't have a six-month emergency fund? Better start saving up...

If health insurance is a big deal to you (you get sick a lot or have a family on your plan), make sure you’ll be covered through any appointments or procedures that will draw down that emergency fund.

Action Item: Tally up your cash and your monthly expenses for the past three months and see how long you can go without a job (or what you need to make at the next job). If the math doesn't add up, make sure you alter your plan to adjust for that.

5. Quitting Time

You've done all the work and now is no time to let up; it's time to be the best damn quitter there ever was. And that means following some simple rules:

Don't Burn Bridges

Be respectful, cordial, and helpful (if you can).

Don't Check Out

It will leave a negative impression on the people you'll one day want a recommendation from — work hard until the end.

Don't Delay

Look back at your journal — there's a reason you're leaving, so don't forget that.

Be a Model

Help with the transition, give at least two weeks, and do what you can to make it easy for your employer. It will pay off in the long run.

Action Item: Memorize the previous four bullets and make sure you re-read them when you're about to give notice and during the two weeks you count down the days until you're set free.

Once you've done all the legwork and made sure you'll be moving into a better situation, you've earned the right to pull the trigger. Don't forget to be nice about it...you may wind up working with some of the people you're leaving behind in a few years.

This article is from Carlos Portocarrero of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

21 Ways to Make a Big Financial Change

Nora Dunn — Tue, 04 Dec 2012 11:24:33 +0000

Making a big financial change in your life is similar to making any big change — it can often be overwhelming to the point of derailing you entirely. Here are 21 ways to help you stay on course and make big financial changes in your life. (See also: 25 Frugal Changes You Can Make Today)

1. Start Small

Going whole hog right from the start is a recipe for relapse. Instead, start small. As a parallel example, if you want to start exercising but can't fathom committing to a gym routine, then start with five minutes a day. (I started that way and progressed to an hour — which I now love).

Even if you don't think it will make a big difference, the small and manageable start creates habits you can build on.

2. Change Jobs

It might be to inject some passion into your work, to earn more money, or for another soul-satisfying reason, but changing jobs might be the change of scenery you need to inspire other big financial changes.

3. Eliminate Negativity

Negative people and influences do you no good. In order to stay on track with big changes, surround yourself with positive, supportive people.

4. Understand Want vs Need

The things you “want” will probably detract you from your big financial changes, whereas the things you “need” must be incorporated into the plan.

5. Track Your Expenses

You can't make big financial changes unless you know your starting point and end goal. Your initial expense tracking is your starting point, and continuing the process will help you stay on track.

6. Share Your Plans

Telling your family and friends about your planned financial changes will create a support network and keep you accountable to your goals.

7. Track Your Progress

Big changes can be slow going, so you need to see that you're getting somewhere otherwise you'll give up. To track your progress, you can use a journal, a vision board, or a giant poster-board designed to track your progress.

I have a friend who wanted to get in shape on their treadmill. So they decided to walk across Canada — on the treadmill. They recorded their distance walked each day, and watched their proverbial progress across the country as they logged it on a large map. This kept them motivated to walk every day; the treadmill experience alone was too boring.

8. Revise as Necessary

Be willing to revise the changes you're making. If it's a long-term goal, your life might change along the way such that your initial goal is no longer paramount or relevant. Part of the process of tracking your progress is being willing and able to adjust your goals with your life.

9. Replace Habits

Instead of trying to cut bad habits right out, find a positive or constructive (or at least less counter-productive) way to replace them. For example every time you want to buy a latte, do something else that helps you achieve a similar satisfaction — perhaps buying a pack of gum or eating a chocolate-covered coffee bean. Under the principles of behavior modification, you can change unwanted habits by replacing them.

10. Practice Projection: If This, Then...

Create a projection forward in time from where you are now given your current course. This is what your life will look like in “x” years if you don't make any changes.

Then project what your situation will look like in the same time frame if you make your proposed changes. Compare the two outcomes. Are you inspired by the difference in projections?

11. Simplify

Simplify your life. The less “little stuff” you have to worry about, the more focused on your big changes you can be.

12. Visualize

You have to see it, smell it, and taste it in order to achieve it. Fear of the unknown will keep you firmly rooted without change. If you can see the end result, it will be easier to achieve.

13. Stop Criticizing

Stop unnecessarily criticizing yourself and indulging in negativity. If you don't feel you deserve what it is you're aiming for, you'll never get there.

14. Run Towards Change, Not Away From Something

If you focus on running away from something, that something will likely follow you around like a lost puppy dog. We respond better to positive goals, not negative ones. Don't allow yourself to be a victim; instead make sure you're focused on the positive outcome instead of the current problems.

15. Stop Thinking!

Analysis paralysis is very real.

16. Start Today

There will always be a reason to wait until tomorrow. Don't do it.

17. Break It Down

Big changes usually involve a series of small steps. Break down your overall goal into small achievable steps. This makes it infinitely more manageable (and satisfying).

18. Ask for Help

There's no shame in asking for help, and you can strengthen relationships while you're at it.

19. Change Your Identity

You want to take control of your finances, but if you continue to see yourself as somebody who knows nothing about money, then you'll forever remain so. Instead, do something to empower yourself to be somebody different (maybe take a class or start mingling with different people who don't know the “old you”), effectively changing your identity and self-image towards the person you want to be in the lifestyle you want to live.

20. Slow and Steady

Don't do everything overnight. If you try to make lots of changes too quickly, it all tends to fall apart at the seams, and you'll feel you've replaced one set of problems with a whole new set. Change one element, get used to it, then proceed to the next step. If you want to ingrain new habits and paradigms, it will take time. Give yourself permission.

21. Strategize

Incorporating the elements and suggestions above, create — and write down! — a specific (and revisable) strategy to get you from here to there. This also ties into the points above about tracking your progress, projecting, and visualizing.

How do you make — and stick to — big financial changes in your life?

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This article is from Nora Dunn of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

5 Ways to Make Yourself Accountable

Meg Favreau — Mon, 03 Sep 2012 10:24:42 +0000

Sometimes motivation likes to play hide-and-go-seek, leaving you lethargically poking around, trying to find it, until you finally give up and flop onto the couch. It can be especially hard to find the motivation when there isn't an external force holding you accountable, like your boss needing work from you. If you're struggling with achieving your personal goals, whether they have to do with money, health, or something else entirely, follow these tips. (See also: But I Don't Want To! Secrets to Self-Motivation)

1. Set a Deadline, and Make Changing It Beyond Your Control

I signed up to run a 10 mile race this morning. I'm not telling you this so I can be one of those expansive-ego people who brags about how much they run (also, the next time you're annoyed by one of those healthier-than-thou guys, remember that he probably has weird bruised toes and/or chafing in very delicate areas). Honestly, I'm not a great runner, and while I like to be healthy, running is not my top priority. But I know that if I've spent the money on registering for a race, I'm going to follow my darn training schedule and be able to run 10 miles by early October, because I am not wasting cash on a race fee.

2. Share Your Goals and Plans With Others

There are those who believe that you shouldn't share your goals because the feel-good social acknowledgment will actually make you less likely to achieve them. But in some cases, telling other people that you're going to do something can be a powerful motivator to get it done — even if you're the only person affected by it (hey, you don't want to be a disappointment!). You can even start a blog or twitter account to track your progress.

3. Partner With Someone With Similar Goals

If you have a bicycling buddy, it's going to be a lot harder to cancel a bike ride with a friend than it would be to just tell yourself "I'm not going out today."

4. Sign Up for a Site Like StickK

The website StickK is a more formalized version of number two above — not only does it help you share goals, but you can also put money on the line. You designate the recipient of the money if you don't achieve your goal — it could be a friend, a charity you like, or perhaps most deviously, a charity you hate.

5. Reward Yourself for Reaching Goals

Simply giving yourself a random reward for achieving a goal isn't the same thing as being accountable. But if you designate a reward that you're not allowed to have until you complete your task, that can help. You can also designate things you'll deny yourself if not successful.

How do you keep yourself accountable? Share in the comments.

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This article is from Meg Favreau of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

How Much Money Will You Need to Retire?

Julie Rains — Tue, 26 Jun 2012 10:36:09 +0000

This article was made possible by support from OppenheimerFunds.

Planning for retirement seems like a daunting task. Calculations can be complex, especially if you want to be precise in projecting yearly cash flows over your lifetime. And considering all aspects of your financial picture can be overwhelming and confusing if you're uncertain about income needs, investment returns, inflation, tax rules, and government programs in retirement.

To make this process easy, I’ve put together a downloadable spreadsheet entitled “Retirement Planning in 4 Easy Steps” that should take just a few minutes to complete. You should have a clearer picture of your financial future and what steps you can now take so that you can live retirement in the style you want. (Note that for illustration, I have populated the spreadsheet with income and investment numbers.)

Step 1: Determine Annual Income Needed From Financial Investments During Retirement

Financial experts estimate that you will need 75% to 85% of your current annual income in retirement. These percentages may seem high, especially if you have acquired all the assets you think you’ll ever need by retirement age. Further, you might think that many expenses will disappear, like your mortgage payment, or they’ll shrink dramatically, like your grocery bill when your kids move away. But you’ll still have to pay property taxes, insurance, and maintenance on your house. Plus, higher expenses for healthcare and personal care may cancel out grocery savings, particularly if a family member develops a chronic illness.

Fortunately, you may have sources of annual income other than retirement accounts, like a pension or business revenue. Your retirement savings or nest egg, then, just needs to cover the difference between total income needed for retirement and income from other sources.

To determine annual income needed from financial investments, enter this information in the spreadsheet: current annual income, expected income from other sources, and percentage income needed in retirement, going lower if you plan to live frugally and will have paid off debt and higher if you desire to live luxuriously or will still have a mortgage in those later years.

Step 2: Calculate the Future Value of Current Retirement Savings and Annual Contributions to Retirement Funds

If you’ve already set aside money for retirement and are regularly saving money each year, figure out what those investments will be worth when you retire.

Enter the value of the retirement savings now, annual contributions to retirement savings, age now and at retirement, and expected investment return during your working years. Calculate the future value of your retirement savings if you simply stick to this plan of investment.

Step 3: Determine the Investment Value Needed to Fund Retirement Expenses

There are two schools of thought in determining the investment value needed for retirement. One approach is to save enough to spend investment returns and draw down the principal each year, depleting savings over your lifetime; ideally, you’ll die about the time you run out of money. The other method is to build a nest egg that allows you to live off the investment earnings and preserve the principal in case you live longer than expected. To keep the calculations simple, I have chosen the second method.

Enter your expected investment return in retirement and calculate the amount needed to generate the annual income to cover retirement expenses as specified in Step 1.

Step 4: Figure Out How Much to Increase Annual Savings to Meet Your Retirement Goals

After calculating how much investment in retirement savings you need, figure out how much extra to save to reach your goals. First, determine the shortage (or surplus if that applies); then calculate the additional amount to save and invest each year.

This approach is fairly simple, but ignores taxes, inflation, and investment risk. Inflation, in particular, can dramatically increase expenses and change retirement scenarios; for example, consider how inflation at 1% and 2% during your working years could increase later requirements for income, investment needed, and annual savings contributions.

Inflation/Changes in Retirement Scenarios	0%	1%	2%
Income to Be Funded From Investments	$50,000	$67,000	$91,000
Investment Needed	$625,000	$838,000	$1,138,000
Additional Savings Needed Per Year	$5,120	$7,800	$11,600

To keep pace with inflation, consider increasing your savings as your income grows and pursuing higher investment returns during your working years, or discovering ways to reduce expenses in retirement.

Fluctuations in investment returns can also affect the viability of retirement plans. For simplicity, the spreadsheet uses a reasonable but not guaranteed investment return during your working years (6%) and a slightly higher rate in retirement (8%). But if the investment return was 7% or 6% in retirement, you would have to save more each year.

Investment Returns/Changes in Retirement Scenarios	8%	7%	6%
Investment Needed	$625,000	$714,000	$833,000
Additional Savings Needed Per Year	$5,120	$6,300	$7,800

To earn such returns and still protect your retirement funds, allocate your money to higher-return, higher-risk investments, such as stocks, mutual funds, ETFs, etc. (keeping in mind that these investments may lose rather than gain in value) and lower-risk, lower-return savings, such as bank CDs, savings accounts, money market funds, treasury bills, or corporate bonds. To generate an overall return of 7%, for example, equities of $400,000 would need to earn 10% combined with a 1% return of $200,000 in a savings account.

So don’t ignore retirement-planning wild-cards like inflation or uneven investment growth. But don’t let fear or uncertainty about the future keep you from taking easy steps toward retirement now.

This article is from Julie Rains of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Defining What Financial Success Means to You

Debbie Dragon — Mon, 25 Jun 2012 10:24:08 +0000

There is an old story about a young boy who is asked by an adult what he wants to be when he grows up. Not one to waste time as a fireman or an astronaut, the young boy gets right to the point and announces that when he grows up, he wants to be rich. (See also: Do You Really Want to Be Rich?)

The boy’s ambition is one you likely share. After all, how many people do you know who aspire to become poorer as they get older? But what does it mean to be “rich”? While some people might define financial success as achievement of a particular net worth, that may be the wrong way to think about it. As Adrian J. Cartwood, author of the soon-to-be-available book “Share Your Number” and the financial blog 7 Million in 7 Years, explains, "People, even rich people, are often dissatisfied with their level of financial success because they have failed to make the one true connection: that your life isn't about money, rather your money is there to support your life."

Instead of thinking about financial success as a mere number, Cartwood suggests that the best way to achieve monetary fulfillment is to first understand how you want to spend your money — only then can you figure out how much you will need to finance your dreams. "It's only when you find your life's true purpose and calculate how much money you need in order to support the life of your dreams — whether that be $100,000 or $100 million — will you really know what financial success means to you," he explains.

So how does one do this?

1. Take a Closer Look at Your Life

Start by asking yourself questions about what you enjoy doing. This will help you create a clearer picture of your goals for your future and give you a starting point for figuring out what that future will cost. Ask:

What are your favorite activities, interests, and hobbies right now?
Do you think you will want to continue doing them in the future?
Is it feasible to continue some of the things you enjoy now as you get older, or do you anticipate stopping some of them?

2. Dream Big

If money was not an object, what would you love to do? Sail around the world? Build a tropical vacation home? Start your own business? Simply be able to fish every day in the pond near your home? Do not be afraid to name your dreams out loud, no matter how far-fetched they seem. The more specific you can be about your goals for your life, the easier it will be to develop a plan to reach them.

3. Figure Out the Costs

Once you know what you would love to do with your life, you can start to determine how much money you need to pay for your dream future. Depending on your plans, this might be as simple as looking up the cost of buying and maintaining a recreational vehicle or as complicated as estimating how much money it would take to open a restaurant in your neighborhood. Either way, you will need to have an idea of how much money you are going to need to finance your desires and still pay for your day-to-day living expenses.

4. Develop a Savings Plan

Finally, you need to figure out how you are going to earn and/or save the money you need to reach true financial success. The amount may not be enormous; after all, if your dreams are inexpensive, then your personal definition of financial success will be modest. Of course, if you have grand plans for your future, you will need to figure out a way to put enough money away to be able to live the life you desire. And more importantly, you will want to start living that life as soon as possible. Consider your current earnings, how much you are likely to earn in the future, and how much money you can put away on a regular basis. Talk to an investment advisor to help develop a plan to make your savings grow.

It may take hard work and planning, but having the money available to give you the life you truly desire is a worthwhile and reachable goal — and it's the true measure of financial success.

This article is from Debbie Dragon of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

And...Breathe: Become More Patient in 9 Easy Steps

Julie Rains — Fri, 25 May 2012 10:36:08 +0000

Patience is a virtue, or so you’ve heard. But if you’re like me, you wonder how patience could benefit you, not just the people who seem to relentlessly and persistently demand patience while seemingly causing unnecessary delays in a fast-moving world.

Eventually, though, you’ll discover that impatience can thwart your otherwise deserving efforts, interfere with reaching your goals, and cause trouble. When exercised at the right times and in the right ways, patience can not only augment forward movement but also build respect for you and your decisions.

Cultivating patience is easier than you may think, but it requires getting perspective in the heat of crises and frustration of everyday life. Here are steps I have taken to develop the sort of patience that is virtuous and pays off. (See also: Friends and Goals: Don't Let a Blue Falcon Bring You Down)

Practicing Patience

The best way to cultivate patience is to practice patience. That is, pretend to have patience, and see what happens.

The more you test acting patient in various scenarios, the better you become at discerning when patience is necessary for desired outcomes or when aggressive action is the right way to get things done, when being patient commands esteem or when agility wins favor, when being patient helps you to gain support or when quick decisiveness gets you noticed.

1. Make Progress Toward Your Goal

Don't mistake patience with tolerance for inaction. True patience is working while you wait. This process should involve regular evaluation of whether the tasks you are doing or waiting for someone else to complete are going to deliver the results you want.

2. Realize That Setbacks Can Move You Closer to Your Goal

Setbacks are frustrating and can lead you to lose patience, not acquire it. Very often, though, mistakes you make, rejections you receive, confusion that arises, and support you don't win gives you insights that help move you closer to whatever outcome you desire. Setbacks, then, are not simply delays. They are signposts that can guide you to your destination.

When things don’t happen or unfold as planned, consider what happened. Figure out if you misread a situation, overestimated the strength of a supporter, needed more information, etc. Revise your approach and keep moving.

3. Get a Handle on a Typical Wait Time

To become patient, you should have a general idea of how long things should take. For example, there are commonly accepted timeframes from request to response for many situations, such as a marriage proposal (immediate), thank-you letter for a new job (1-3 days), or a prototype request (a week or longer).

Your expectations should have some basis in reality. Ask friends and experts to figure out what is considered reasonable for a waiting period.

4. Decide If You Really Want to Wait

Figure out whether you are willing to wait for whatever time is required. If "yes," wait patiently with the understanding that the timeline may be longer than you had anticipated. Re-evaluate your decision to be patient if things are not moving along at a reasonable pace.

If you are not willing to wait but want to try a plan B, remember that you may still not get what you want when you want it. Plus, you may find that quality standards may be lower and prices could be higher if you choose the fastest possible method, with notable exceptions like instant downloads and express delivery.

Or you may abandon a particular goal or desire altogether if the wait is too long. There is no shame in not being patient and waiting for something that you later realize you don't really want.

5. Take Time to Process New Information

When confronted with a new challenge, an unfamiliar scenario, or an unclear assignment, take your time to devise a well-conceived plan. Such planning typically involves researching an opportunity, learning what others have done in similar situations, and determining what’s novel about your challenge. It also requires investing significant amounts of time to absorb information, process new ideas, and, finally, connect the dots to craft a breakthrough solution.

Remember that rushing doesn’t help. Impulsiveness causes you to move along too quickly, later making you hesitate at critical points that require swift action and making you uncertain when decisiveness is needed. Be patient with yourself as you learn, absorb, adapt, strategize, plan, and execute.

6. Learn How Being Rushed Can Threaten Success

Notice how moving too fast can compromise success of an endeavor. While many people (claim to) work well under pressure, most need sufficient time to get things done right. That often means that you must patiently wait for your turn or allot plenty of time for whatever you are trying to accomplish.

For example, acting too quickly may mean that you don’t take the time to...

Research home prices or review home inspection reports before snapping up a new property listing that you later learn is overpriced.
Compare benefit packages and corporate cultures associated with two different job offers before accepting one that isn’t a good fit with your work style and personal needs.
Teach a new skill or technique to a friend, coworker, or child, taking shortcuts that lead to mistakes and long-term learning problems.
Get to know someone before taking significant steps toward a long-term relationship, preventing you from laying a foundation of mutual trust.

7. Look for the Right Moment

Become aware of the right moment to bring up a sensitive issue with a friend or coworker. By refraining from an aggressive confrontation and waiting until the person comes to you for advice or the topic emerges as a concern, you may be able to more fully capture this person’s attention and maintain a friendly relationship.

When the time is right, weave your talking point into a conversation. Perhaps your friend is confounded by his child or a coworker is frustrated with her boss. Get both attention and appreciation as you problem-solve, rather than challenging them before they are ready to listen.

8. Enjoy What’s Happening Now

Learn to enjoy your present state, the time before your goals are realized and when there is still uncertainty about whether your efforts will reap benefits. Be grateful for what you have right now, show pride in your accomplishments to date, revel in whatever you are learning and doing, and plan for rather than fret about the future.

9. Don’t Worry What Other People Think

When you demonstrate patience, onlookers — including your friends, family members, bosses, coworkers, and customers — may think that you are not aggressive enough. They may wonder why you don’t take immediate action, even as they complain about those who act too rashly, make quick decisions without considering all aspects of situation, etc.

At the same time, some people will consider you impatient simply because you insist on moving forward. But after you have cultivated this virtue, remember that you are the best judge of whether you are showing enough or too much patience.

Just recently, I discovered that having the aura of patience can help speed things along. That is, a polite smile despite delays, willingness to wait, etc. encourages people to provide immediate help rather than sending you away to come back another day.

The best thing about having patience, though, is being able to discern when to wait and when to act.

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This article is from Julie Rains of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread: