Five new year’s resolutions for a better financial life in 2025

If you are making new year’s resolutions that involve how you manage your money or require money to achieve them, you will also need to make some plans to ensure that you can stick to these resolutions.

Here are five resolutions and the plans that can help you achieve them.

Manage my money better

If you want to manage your income better and not run out of money a few days after payday, you need to make some plans about how you spend your money. Plans that ensure you spend money on things you need and that matter to you. These plans can help you avoid spending money impulsively or unnecessarily. With a good idea of what you want to do with your money, you can avoid spending that you mistakenly think will make you happy, but instead creates problems such as debt or not having enough for your needs until your next pay day.

The plan: The key plan you need to make to manage your money better is to think through your budget. Set up a budget plan for the year ahead and use your banking apps to track your actual expenses against the plan.

Use your plan to inspire you to turn your financial life into one that enables you to live the life you want. It may involve some adjustments, especially if your finances are in a bad shape, but keep your focus on your goals.

Be debt free

If your finances are in bad shape because you are repaying a lot of debt, a good new year’s resolution would be to tackle paying down your debt with a view to ultimately becoming debt free.

The plan: List your debts and take note of how much the interest rate is on each debt. Work out a budget plan that will let you live within your means so you do not incur more debt and which will create some space for you to make additional repayments of your debt. Pay down the smallest debt or the debt with the highest interest rate first.  Read more: How can I pay off my debt faster?

If you are unable to make your debt repayments and have enough on which to support yourself and your family, consider going under debt counselling.

Watch: Watch: Know your numbers when you are in debt; Watch: Get real about the cost of debt; Watch: Two ways to pay off your debt;

Set goals

A good new year’s resolution is to set a financial savings goal. Consider what you would like to achieve with your money: to save up for your own home, a car, a holiday or your children’s education. Your retirement should also be a longer-term goal.

Depending on your financial situation, you may only be able to start small with one shorter-term goal, or if your finances are in better shape, you could set multiple goals for the short, medium and long-term.

The plan: Name your goals and do some research on what they will cost so you can start saving the appropriate amount and earning an appropriate return to achieve your goal within a realistic deadline. If it is not possible to save the amount calculated, revise your goal amount or deadline. Watch: Watch: Setting savings and investment goals or read: How do I set savings and investment goals?

Start saving and investing

Aligned to your savings goals or without any specific goal in mind, it is always a good idea to resolve to save. Don’t lose your resolve because you believe you can't afford to save – unless you are living on a very low income like a social grant, you can in all likelihood find a way to save.

Regardless of what you earn or in what shape your finances are, start saving something – even if you are focussing on paying down debt, start with a small emergency fund.

As you pay down debt or earn more, save a little more and then graduate to investing.

The plan: Consider your budget and make room for savings. Set up a savings account – look for the best interest rate on a savings account, fixed deposit or money market fund that you can get for the amount you have to save.

Set up an automatic transfer or payment from you transactional account for each month of the year to pay your savings account first.

If you are already saving, but haven’t yet started investing, you could set yourself a new year’s resolution to start your first investment.

If you don’t know where to begin, start here:

What are the key things I need to know before I start investing?
How can I get access to the markets?

What is a unit trust fund? or watch:

What is an exchange traded fund (ETF)?

What is a financial index?

Why are there different kinds of multi-asset funds?

Infographic: Which fund should I choose given how long I have to invest?

Keep your financial life on track

You may have the best resolve and plans to get your financial life on track, but if you are not prepared for things that life can throw at you, your best laid plans will come unstuck.

A good resolution to make for new year, is to check and put in place cover for the unexpected: a financial emergency, an illness, a disability and even your death if you are a breadwinner supporting dependants.

The plan: Set up or top up your emergency savings account. Ideally, you should have enough to cover three to six months of expenses in the account, but don’t let that target intimidate you. Just start some savings, no matter how little, it will save you borrowing when emergencies arise.

Check what cover you have for death, disability and illness and consider whether it is sufficient should these eventualities arise. It is usually best to get a trusted financial adviser to help you work this out and to find suitable and affordable cover, but if you don’t have someone to help you, some insurers offer online calculators and policies. Remember that whatever cover you can afford is better than not being covered at all.