It is the best time of the year to make plans for your career, financial endeavor, family and in any aspect of your social life. Since this blog is about personal finance and financial management, I would like to talk about financial planning for this year. I’m a firm believer of careful planning so that a good result will happen. Without planning, there is always a high probability of messing up or goals cannot be reached.

For many people, this is the best time to make New Year’s resolution in order to have a good planning for the whole year. I’m not against it and actually I’m encouraging you to do it also. It is one tool that can give you direction n what things you must do for this year. If you want some ideas on what financial plan you should carry out, you can read some of my suggestions for you.

1. Pay your debt continuously

It is the best time of the year to pay all your debts and obligations to other people including your credit card company. Debt should not be ignored or forgotten even if the person is your parents, siblings and friends. Actually, it is more appropriate to pay your debt if you owe it to your relatives.

A better financial goal for 2012 is to achieve zero debt, as in zero, no credit card debt, no 5-6, no loans and obligations need to be paid to other people.

2. Live below your Means

In the present world today, we are bombarded by a lot of consumerism strategies and propaganda of many companies. Sometimes, you are carried away and you ride in the “norm” even though you cannot afford to have it. That’s why there are lots of credit card companies and loan agents to satisfy the urgent need of many people wanting to buy more and more.

Living below your means is not popular these days because it involves a lot of discipline and delayed gratification. Include this one in your plan and your life will be better and less stressful.

3. Start to save money

This time of the year is the ideal time to start saving. If all possible, I suggests you start saving at least 10% of your income each month. However, if your current situation doesn’t permit it, start at least P100 a month or more until you reach the 10 percent mark.

It is really hard at the beginning especially if is not your habit to save. But as you start it, the difficulty will lessen and it will become normal to you as the time goes by.

4. Control your expenses

A good ingredient of a financial plan for this year would be to control your expenses as much as possible. It is always good to be frugal or wise in spending money rather than an impulse buyer. You can set a maximum monthly budget so you know how much money you need each month for your basic needs and other expenses.

5. Increase your income

For this year, you may start to look for another income stream apart from your job or business. I would suggest you start to make money online by selling stuffs in eBay or if you are good in writing, you can start blogging about your passion or the things your interested. Other ways to increase your income is begin investing some amount of your saved money in mutual funds. For as low as P5,000, you can start investing in mutual funds or if you have more money, learn how to invest in Philippine stocks.

There you go, this is short list you can include in your financial plan for this year 2012. I hope you get some ideas in this post. Do you have other financial plans for this year? Please share it with our readers. Thanks.