By now, you may find that your fervent vows to lose weight and get to the gym regularly have fallen by the wayside. But take heart, there’s still plenty of time, and plenty of ways to take advantage of the new year to get your finances on track.

Just don’t expect it to happen all at once, experts say.

“The very first thing you do as you make your resolutions is say, ‘My money management is going to be an evolution,’” said Patricia Lovett-Reid, senior vice-president at TD Waterhouse Canada Inc.


“Commit to saying your financial life matters and you’re going to make it a priority. Do one thing differently each month — you will be in a very different financial situation one year from now.”

There’s an analogy she likes to use: Think of yourself as the hub in the centre of a bicycle wheel. Each spoke on the wheel represents an element of your financial life, such as investments, estate planning, insurance, debt, or credit.

“As you address each spoke, you start to gain momentum and you start to gain traction,” Lovett-Reid said. “What happens is even in periods of volatility in the market — and there will be volatility in the market — you feel a sense of control because you’re dealing with each element. And so you gain momentum. You get a better trajectory.”

This doesn’t involve a huge time commitment, said financial planning expert Kurt Rosentreter, financial adviser with Manulife Securities Inc.

Allocate eight hours to your personal finances in 2010, he said. That could be four hours for your investments, maybe two two-hour long meetings with your adviser, or sitting down and reviewing your investments yourself. The other two or three hours could be basic education about mortgages or children's savings, with another hour or so looking at insurance or wills.

“People say they don’t have the time, but they’ll watch eight hours of TV in two nights or spend that time on the Internet,” Rosentreter said.

“Get some accountability over that and you won’t be sitting around in five years wondering, ‘Where did all my money go?’ or ‘Why did I never make money on my investments?’”

If you’re still wondering where to begin, start by writing down your short-, medium- and long-term goals. Once a year, measure progress toward them and build a plan around that.
Lovett-Reid and Rosentreter offered some quick examples of financial resolutions for the new year.

Investments: Make sure your investments are aligned with your goals. For instance, you’re not going to go into the equity market if you plan on buying a house in the next 12 months. You’re going to need that money and the amount of risk and volatility would be too high. If you’re apprehensive of dealing with your finances because you feel you don’t know enough, try to learn more through basic personal finance courses or reading on your own.

Tax planning: “Too many of us think tax planning is just filing your taxes at the end of April or just putting some slips into a software tool and mailing it off. Real tax planning happens all year long and it’s more a matter of just understanding the rules and applying it to your personal circumstances,” Rosentreter said.

"Ask yourself, ‘Can I make a spousal RRSP contribution? Can I split income with family members? Can I loan money to my spouse?’”

Not sure where to start? Sign up for some tax newsletters or sit down with an accountant.

Estate planning: If you haven’t reviewed your will in a long time, pull it out this year. You should review your will about once every five years, or around big changes in your life.

Advisers: If you use an adviser, make time to sit down with him or her and talk about the impact the market fluctuations have had on your investments.

Mortgage: More than likely, Canadians will be faced with higher interest rates this year. That means you may need to ask yourself some hard questions. Are you paying it down fast enough? Will you be able to afford a bigger payment if higher interest rates come, and if not, what does that mean? If you’re contemplating a bigger house or a second house, is that wise in a year when it could get a lot more expensive to borrow money?

Debt: Resolve to get a handle on it, really figure out how much you owe, particularly on your credit cards and lines of credit. “Most of us know how much money we make. We don’t necessarily see what we’re spending it on and that’s a problem,” Lovett-Reid said.

“You will have to confront that debt so you can begin to build a plan and move forward.”

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