Even as I pen this article, I am aware of the skepticism around new year resolutions. Let me be more precise; I am reminded of the Forbes article New Year Resolutions are for losers. According to it, 40% of Americans will make resolutions, 80% of them will fail by January end, and a measly 8% of resolution makers will follow through.
I honestly don’t think one needs a calendar date to nudge us to improve our lives. Having said that, when one looks at how the tradition of making New Year’s resolutions originated, it does have its charm. The month of January is named for the Roman god Janus. The ancient Romans imagined Janus as one with a double-faced head; one facing forward and one facing back, symbolizing his ability to look forward and backward at the same time. And apparently, that is how it gained in popularity.
I am not in the habit of making new year resolutions because I fall in the 80% category. But this year, I am attempting an experiment with frugality. Every two months, I plan to practice frugality for the last 2 weeks. For instance, no Ola or Uber or even kaali peeli cabs during those days, just public transport. No eating out, just home cooked food. My goal is not complete self-denial, but to push myself and test the boundaries and find out what works and what doesn’t.
Why am I doing this? Because, despite writing about the merits of saving, I am often lured into consumerism. Since I have zero credit card debt, no liabilities and no dependents, I should be saving and investing much more than I am. And let’s face it, every single year, we are one year closer to retirement.
I have also picked up pointers from my colleagues across the globe.
- Christine Benz
- Director of personal finance
- Chicago
One long-standing item on my financial to-do list is to look at my husband’s and my asset allocation in total and determine whether we should reposition any investments. Our portfolio is quite equity-heavy relative to any sane recommendation for people our age, but we don’t pay much attention to the market’s short-term fluctuations and consider ourselves extremely risk tolerant.
But I’m mindful of the fact that the last time this tolerance was tested was more than 10 years ago during the global financial crisis, when we were 10 years younger and 10 years further from retirement. If stocks go down and stay down for a sustained period, it will likely feel much different – and much worse – than it did on the last go round.
Lesson for me: I periodically check my asset allocation and am fairly happy with it. However, I would like to invest a small portion in global equities. I will have to figure that out.
- Sylvester Flood
- Chief content strategist
- Chicago
I need to rebalance my investments – part of the problem is that I own some turkeys (funds that haven’t flown) and I should really accept those mistakes and move the money elsewhere. Elsewhere, I vow to reduce unnecessary spend on home security, a landline phone and home insurance and, more morbidly, I need to write my will (sorry, I won’t be writing any of you in).
Finally, I need to buy a personal liability insurance policy. Someone tripped on a crack in the pavement in front of my friend’s house recently; the person sustained a head injury and my friend was sued. Yes, Americans sometimes live up to their litigious reputation. But luckily my friend had personal liability insurance, so the incident didn’t cost her – although the hassle was quite a distraction.
Lesson for me: A friend, a fitness freak, collapsed when on a holiday. The blood clot in her brain left her partially paralysed. Though my company provides a medical insurance, I have decided to increase my personal medical insurance coverage.
- Dan Kemp
- Chief investment officer at Morningstar Investment Management - EMEA
- London
Most resolutions are broken very quickly, and often it’s because we think about what we want without thinking about how to achieve it and tend to think we can make lots of large changes at once and stick to them.
So, in 2020 I’m going to follow the advice I often give to others: change one small thing by identifying a better strategy to meet a specific need.
My one small thing is to bring a packed lunch into the office every day, something I’ve got out of the habit of over the past couple of years. Not only will this save me money – about £900 a year – but it will also save me about 40,000 calories a year, along with all that additional salt and sugar. It also means I’ll make lunch for my family rather than them having to do it themselves – let’s hope it lasts beyond the first rushed morning of the year!
Lesson for me: I can easily do this with breakfast, instead of ordering in once I get to office. If not daily, at least thrice a week.
- James Gard
- Content editor
- London
I would rather go to the dentist than talk to a stranger about money, but next year I’m going to have to take the plunge and see a financial adviser. I have inherited a lump sum – likely to be my only inheritance – but I can’t decide what to do with it.
Left to my own devices I would put in a savings account and take the 1% a year interest. I don’t want to pay someone to tell me to buy gold ETFs or sink it into a buy-to-let property, but I need an adviser to think of a constructive way of putting the money to work and help me overcome my natural risk aversion. While I want some capital preservation, I have an 8-year-old son and am thinking ahead 10 years to university and beyond and how I can invest the money to help him.
Lesson for me: I manage my portfolio and pick on the expertise of my colleagues, and friends in the industry. I shall skip this one.
- Kaustubh Belapurkar
- Director of fund research
- Mumbai
As discretionary income rises, so does the standard of living. This is not something that happens overnight, it creeps up on you over the years, which makes it all the more dangerous. By allowing my lifestyle to creep higher over time, means that my spending is moving up as my income moves up. And, I would need more to retire because I have a more expensive lifestyle to maintain.
I have decided to be more cognizant of lifestyle creep. Which means that I spend judiciously. This will automatically lead to a higher savings.
Lesson for me: This is something I already pay heed to and is in sync with my resolution.
- Gavin Corr
- Director of manager selection
- London
I am making a new year’s Brexit resolution that I am hopeful will prove to be fruitful financially, and that is to try and remember that bad news is often in the price of assets. Given that I live and work in the eye of the Brexit storm, it is often easy to become disheartened and pessimistic about the state of the UK.
But when I meet overseas fund managers, I am struck by the universally negative opinion they have on UK assets. It’s a stance that contrasts starkly not just with the value that many UK managers are seeing in domestic equities, but also with the global corporate world, who are increasingly looking at UK businesses to buy. The old adage “It’s darkest before the dawn” may apply again and 2020 could prove to be a good year for the UK.
Lesson for me: This is so apt for an Indian. With talks about the slowdown in India, I have decided not to get disheartened. There’s no downside to having a positive attitude and outlook.
A portion of this article appeared in Morningstar's Financial New Year's Resolutions
