Consumers cite saving as least important financial resolution

In its monthly online poll, the National Foundation for Credit Counseling (NFCC) asked consumers about their financial New Year’s Resolutions. More than 6,100 consumers responded as follows:

          My Number One New Year’s Resolution for 2010 is to:

          A. Decrease debt = 76%

          B. Increase savings = 6%

          C. Improve my credit score = 11%

          D. Decrease my dependence on credit cards = 7%

Decreasing debt is certainly a worthwhile goal. However, seeing only six percent of respondents citing saving as a top financial priority is worrisome. Without adequate savings, a person is on a slippery financial slope. When the inevitable emergency occurs, resolution options are often limited to borrowing from friends or family, taking money from a higher payment priority such as housing, or charging the expense and adding to an already burdensome debt load.

Experts recommend designating 10 percent of each paycheck toward building a rainy day fund. At the end of a year, you’ll have a little more than one month’s income set aside which should be sufficient for most emergencies.

Squeezing even an extra 10 percent out of an already tight budget can often be challenging. The most effective way of finding hidden money in your budget is to track your spending for 30 days. Being able to see in black and white where your money goes allows you to make conscious decisions about your spending moving forward.

To help you track your spending, print and carry this Record of Daily Expenditures. Carry this form (or a simple notebook) with you and record every penny you spend—even if it’s only a soft drink from the convenience store, or a trip to the drive-thru at a fast food restaurant.  Most people find that the simple act of recording their actions results in positive changes.

For more, watch the free Webcast titled Building Savings and Wealth or sign up for the free Webinar titled Make Your Money Count.

Portions of this content were provided by the NFCC.  Money Management International is a member of the NFCC.

 

Kim McGrigg is the former Manager of Community and Media Relations for MMI.

  • The Consumer Federation of America (CFA) is an association of nonprofit consumer organizations that was established in 1968 to advance the consumer interest through research, advocacy, and education. Today, nearly 300 of these groups participate in the federation and govern it through their representatives on the organization's Board of Directors.
  • The National Council of Higher Education Resources (NCHER) is the nation’s oldest and largest higher education finance trade association. NCHER’s membership includes state, nonprofit, and for-profit higher education service organizations, including lenders, servicers, guaranty agencies, collection agencies, financial literacy providers, and schools, interested and involved in increasing college access and success. It assists its members in shaping policies governing federal and private student loan and state grant programs on behalf of students, parents, borrowers, and families.

  • Since 2007, the Homeownership Preservation Foundation (HPF) has served as a trusted, neutral source of information for more than eight million homeowners. They are partnered with, and endorsed by, numerous major government agencies, including the U.S. Department of Housing and Urban Development and the Department of the Treasury.

  • The mission of the U.S. Department of Housing and Urban Development (HUD) is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD works to strengthen the housing market in order to bolster the economy and protect consumers; meet the need for quality affordable rental homes; utilize housing as a platform for improving quality of life; and build inclusive and sustainable communities free from discrimination.

  • The Council on Accreditation (COA) is an international, independent, nonprofit, human service accrediting organization. Their mission is to partner with human service organizations worldwide to improve service delivery outcomes by developing, applying, and promoting accreditation standards.

  • The National Foundation for Credit Counseling® (NFCC®), founded in 1951, is the nation’s largest and longest-serving nonprofit financial counseling organization. The NFCC’s mission is to promote the national agenda for financially responsible behavior, and build capacity for its members to deliver the highest-quality financial education and counseling services.