Five Financial New Year Resolutions

New Year Resolutions, do you ever keep them? Join the gym on the second January, never set foot inside after the middle of February. Yes, I know you were full of good intentions, but good intentions don't get you fit. The same goes for your cash. If you're apathetic about financial matters, too, then your finances will turn into couch potatoes.

I'll say it as clearly as I can: Leaving your money in current accounts that earn no interest, failing to sort out your debt, procrastinating over sorting out your savings these won't make you poor in the short term, but they'll sure make you financially flabby over the long term.

I know you lead a busy life, so here are five brief, no-brainer resolutions for 2007. Stick to them and you will find that your bank balance will be better off for it.

1. "I will sort out my credit cards"
No time to mess around here you are simply throwing money away if you don't begin to clear debt now. Don't just pay out the minimum repayment each month, push to pay a bit more.
Once you've decided on an amount, make sure you set up a direct debit. That way you avoid extra charges through late payment.
And are all your balances on one card? Don't mess around by trying to juggle more than one, make it easy for yourself to manage.
If your circumstances change and you experience financial pressure tell us, we may be able to reduce your minimum repayment levels or even suspend payments for a time.

2. "I will use my tax-free ISA allowance"
The ISA, or Individual Savings Account, helps to shield your savings from the clutches of HM Revenue and Customs. Not bothering to use your annual allowance is on a par with sending Gordon Brown a cheque every year.
Far better to put your money either in a cash ISA, or if you are happy to accept the risk of capital lost for greater growth potential, you may wish to consider a stocks and shares ISA.
Anyone over 18 (16 for a cash ISA) can open one, and all the proceeds belong to you. You can use it to save for a nest egg for the future, or to supplement your retirement.

3. "I will review my buildings and contents insurance levels"
When was the last time you bothered to shop around for cover? By reviewing your policy frequently, you can ensure that you are getting the best and most cost effective cover for your circumstances.
Failing to update your insurance means that new items you've recently bought won't be covered by the policy. If you had to make a claim, this might mean you receive less than the cost price of the items and you might come into conflict with your insurers for underestimating the sum you needed to protect. They could in some circumstances even turn down the whole claim.

4. "I will consolidate my debt"
A personal loan here, a car loan there, a couple of credit cards and a bank overdraft. Do you really know how much your debt is costing you? Thought not.
Start by getting rid of the overdraft, especially if you didn't arrange it, because unauthorised borrowing is very expensive. Then think about paying off your cards.
Check whether personal and other loans have penalties for exiting early.

5. "I will take out life protection"
No-one likes thinking about the unexpected happening, which is why we're all so useless at writing a will and arranging life insurance. But neglecting to do so could leave your loved ones in a terrible mess should you die suddenly.
A small sum each month in the form of your life insurance premium will ensure that in the event of your death during the term of your policy your spouse and dependants will be able to fulfil any financial obligation with the lump sum repayment. The harsh reality is that the absence of such a plan could result in the your family being forced out of the family home.