Jan. 1, 2013 -- intro: There's your physical well-being and then there's your fiscal well-being, and whipping both into shape is among most people's top New Year's resolutions.
Of course, as we all know, making a resolution and actually keeping it are two radically different things. And while we can't inspire you to consume less junk food and do more push-ups, we can give you some guidelines on how to get the most bang for your bucks, culled from some of the top financial minds in the country.
To start getting your economic house in order, begin with these seven mantras:
quicklist: title: "I will start an emergency fund."text: Only one in four American households has an adequate emergency savings cushion, Greg McBride, a senior financial analyst for Bankrate.com, told ABC News. For obvious reasons, this is not good. McBride recommends having money taken directly from your paycheck or checking account and putting it into a dedicated savings account. According to Morgan Quinn, editor of MintLife, the first priority should be building up three to six months' worth of expenses in an emergency fund. "For a typical single person, that's normally around $10,000 to $15,000," she said. If you have a family and a mortgage, $30,000 is a safer bet. And "be sure to keep your savings in a high yield account-- around 2 percent--so that it continues to grow."
quicklist: title: "I will not pay any more bank fees." text: As most people are aware, banks are trying to make up for lost revenue, so they charge on everything from monthly maintenance to overdraft protection. A May, 2012 Pew study reported that the average overdraft fee is $35, and said big banks charge an average of $117 per year. "If you can't maintain a minimum balance, or if you don't use direct deposit, the top five banks--Chase, Citibank, Bank of America, Wells Fargo and USA Bank—can charge anywhere from $8 to $12 a month," Stephanie Wei, vice president of banking and financial literacy at nerdwallet.com, a personal finance website, told ABC News. But customers can take a stance. She suggests opting for an online bank, a community bank, or a credit union—"the only place you will find hassle-free, no-fee checking," she said, adding that some credit unions actually have more ATMs than Bank of America.
quicklist: title:"I will save for my retirement."text: Doesn't matter if you're 25 or 45--most people "chronically undersave for their retirement," McBride said. But since the retirement contribution limits for IRA's and workplace retirement programs both increase in 2013, "there is room for everybody to save more for retirement next year than they did this year," he said.
quicklist: title:"I will pay off my debt."text: According to Odysseas Papadimitriou, CEO of credit card comparison website cardhub.com, credit card debt hovers around $6,700 per household. However, this doesn't include debt that people have defaulted on but are still responsible for, "So, the debt picture is much worse than it's portrayed to be," he said. McBride believes that 2013 will be a great year to pay down higher-cost debts. "When interest rates are low, less of each dollar is going toward interest and more toward the principal," he said. "You've got to make hay while the sun shines."
quicklist: title:"I will make a budget."text: Many people shy away from making a list of expenses and finances, because they find it trivial or tedious. But it's a necessity (especially if you want to adhere to Resolution 4, above.) "Aristotle used to say that luxuries quickly become necessities, and we are all victims of that," said Papadimitriou. "Creating a budget sounds trivial, it helps when you get to the nitty gritty of trying to decide what is a luxury and what is a necessity. For example, your i-phone is not a necessity. TV is not a necessity."
quicklist: title:"I will build great credit."text: This is important, because the better your credit the more you can take advantage of rewards and zero percent introductory interest rates. If you have poor or no credit, "We generally recommend using the least expensive card possible – often a secured credit card – and making on-time payments every single month," said Papadimitriou.
quicklist: title:"I will talk about money and estate planning with my partner and my family."text: Most people shy away from uncomfortable discussions about money. But these conversations are necessary part of life. "You should make sure that your family is provided for in the unlikely event that you are injured," said Wei. "Similarly, check in with your parents and other older family members—what plans do they have in place to protect their heirs and assets?"