Simplify, reduce expenses for greater net income in the new year

Key Points

The trouble with New Year's resolutions is their limited shelf life. By the time you read this, most 2008 resolutions - personal and professional - will be little more than hazy memories.

The main reason for such lack of commitment, the experts say, is the impossibly difficult demands that most New Year's resolutions place on well-meaning but naïve pledge-makers.

When it comes to your finances in 2008, there's no need to make ambitious but unattainable promises.

1. Slash your costs for keeping in touch.

With your cell phone, pager, broadband Internet access and regular telephone service, you're never far from anyone you want to reach (or anyone who wants to reach you).

Unfortunately, you're probably paying a lot more than you need to for all that techno-communication.

Contact your primary provider to see what bundled plans are available in your area.

In addition to saving you money, dealing with one company will greatly simplify your bill-paying procedures.

2. Give your accountant a cut in pay.

Sure, you hate paperwork and record- keeping. Don't we all? But, if you find yourself scrambling to find receipts and other records at tax time, you're probably costing yourself some real money in the preparation of your personal tax return.

"When clients present me with a shoe box full of unsorted papers, I have to charge them for the hours it takes to make sense of them," says CPA Tom Normoyle, Huntingdon Valley, Pa. "A simple filing system that separates records of different types is one sure way to reduce my fee."

According to Mr. Normoyle, even the simplest of systems, one file for income and one for expenses, can really make a difference in how much time it takes to prepare tax returns.

3. Save money even while you're paying bills.

Nearly all banks offer free online bill paying these days. Once you sign up and choose a password, you log on to the bank's Web site where you enter the payee's name, address and phone number, and the amount to be paid. The bank takes over from there, either by mailing a check to the payee or by making an electronic transfer of the money. You save precious time, the rising cost of postage, buying checks and trips to the post office. What are you waiting for?

4. Slay the credit card monster.

Life as we know it today wouldn't be possible without credit. However, credit has its dark side as well. Credit cards have been compared to drugs; they offer short-term pleasure in exchange for long-term pain.

Saying "charge it" is quick and easy, but that habit, uncontrolled, can lead you down the road to financial oblivion. As many Americans - no matter how well-educated - have discovered, once you become hooked on credit cards, it can be painfully difficult (and sometimes, impossible) to free yourself.

If your wallet is bulging with plastic, now is the time to relieve yourself of that hazardous burden. Once you get yourself down to the fewest cards you need - a maximum of two for personal and two for business - your wallet will be bulging with the money you've saved instead of all those plastic squares.