I know, I know—you’re probably tired of end of the year top 10 lists and have already broken your new year’s resolution a time or two (those gym shoes by the door are still looking pretty squeaky clean, aren’t they? And is that chocolate cake I smell?). But not all top 10 lists are created equal, and this one has lasting implications for your financial well-being.

One doesn’t just wake up one day knowing how to be money smart. Instead, healthy money habits need to be practiced on a day-to-day basis. So in the spirit of the New Year, why not try to set some goals—both for healthy eating and healthy money habits? Follow these suggestions to get your finances in order and achieve your dream of financial independence.

1. Live within your means

It seems simple, but in today’s world of rising prices, and job insecurity, this is a lot more complicated than it might seem. Living within your means is a way of sizing up what you make, and making sure that your expenditures are less than your income. Remember to think about things like taxes and unseen expenses when sizing up the situation of your monthly income vs. expenses. Making cuts might not be easy, but putting your mind at ease and getting your finances in order will be more than worth it.

2. Create a budget

Creating a budget doesn’t have to be hard—in fact, there are plenty of ways to do this creatively using websites designed to help you or by tracking expenses using apps on your smartphone. Be realistic, and be rigorous. Your budget doesn’t have to spell out where every nickel and dime goes, but it should include all of the normal expenses, leaving room for unseen bills and needs that arise during the month.

3. Pay your bills on time

This should be a no-brainer, but it can be difficult in the hustle and bustle of daily life to stay on top of bills. Make sure to pay bills promptly using things like automatic bill pay and good filing systems to remain organized.

4. Be realistic about needs vs. wants

Is this a hard principle? Sure it is. Especially given the way advertising culture works to convince us that our wants really are needs. But deep down we know what we need to survive and what we desire. Perhaps sitting down and writing down a list of needs and wants and then prioritizing will help you decide what is really important, and what is peripheral to your happiness and well-being.

5. Practice patience

You can’t have it all, and you can’t have it all now. Money smart people don’t have to be misers, but they will wait until the time is right to use their money and savings smartly.

6. Invest wisely

Your financial officer can help you with this, but investing wisely means taking the time to think through your decisions, investing in a variety of different places, and making sure that you are diversifying your holdings. Investing can be tricky—so do your research and get plenty of help in the process.

7. Learn discipline

Whether it be curbing impulse buying or getting up at 5 am every morning to go to the gym, discipline is an important part of financial independence. Discipline means following the steps listed here not for a few days or for a few weeks, but for months and years. And like exercise, it becomes easier with time.

8. Use credit smartly

Credit is an important part of financial responsibility. Some people never borrow, thinking that credit cards and loans are bad. They couldn’t be more wrong. Credit can help you invest in your future by purchasing a home and other important things to keep your family safe, healthy, and happy. The trick is to make sure that you are building your credit score and using credit to help you establish yourself rather than borrowing so much that your debt-to-income ratio is out of proportion.

9. Encourage urgency

You should have opened up a savings account yesterday—or the day before. Financially responsible people feel a sense of urgency and immediacy in establishing good money habits. And they don’t put off making changes needed to improve their situation.

10. Focus on the big picture

Everyone makes mistakes in their new year’s resolutions, and no one can be perfect in their monetary lives either. There are always bumps in the road—unemployment, illness, or other things beyond your control can offset your gains at times. Don’t get discouraged when this happens. Tomorrow is a new day, and working little by little, you can realize your financial goals and dreams.

Nice newsletter. Good article. Good information. Thank you. Carol

For conventional financing, borrowers with scores at 740 or anywhere above generally receive the same loan pricing (rate and cost). That being said, the better your credit the higher your chances of receiving loan approval with high debt to income (up to 50%) or high loan to value (up to 95%) which can be a major benefit when applying for a new loan. For Jumbo financing, borrowers with credit scores above 800 are generally rewarded with both better pricing and easier guidelines. There are no situations where better credit is a negative when obtaining new financing so we should all continue to strive to reach and then stay in the 800’s.

What are the advantages of a score over 800

Thank you Mike for this information. As a residential realtor the information that you provide is crucial to a successful transaction for my clients. You are indeed a pleasure to recommend to all of my clients. You are so professional, thorough, conscientious and pleasant to work with. !!

Hi Dane! Wanted to make sure I'm clear on this. Am I right in saying that on whichever remodel is done you still take a loss rather than an increase in value - the ROI will never exceed 100% of cost?