Good Intentions Aren't Enough

Those New Year's resolutions look great on paper. But no matter how good your handwriting is, wishful thinking won't make them come true.

Details, details.... According to the results of a December nationwide survey done on behalf of lending exchange Lending, Americans have the right idea about managing their money. But they're going about it all wrong.

Here are a few highlighted results, followed by a bit of Foolish advice.

A full 80% of the respondents who make financial resolutions do not plan to seek professional help to manage their debt and/or finances.

That's not inherently a bad decision -- we Motley Fools have long championed the benefits of managing one's own finances. After all, who cares more about your money than you?

However, 13% of those surveyed by LendingTree said they have no intention of developing a financial plan of any kind. Unfortunately, smart money decisions don't magically appear under the Christmas tree, save for the occasional generous and unexpected check from a distant relative. At the very least take a moment to figure out what's coming in and what's going out. (Here's a cheat sheet on budgeting for the budget-phobic.) You might be surprised where your money goes.

If you're stumped by some cash conundrum, a second or third opinion comes in handy -- particularly when it comes to high-dollar, high-stress decisions like dealing with an estate after a family member's death or making the most out of a complicated retirement portfolio.

For those who decide to seek financial advice from a pro, make sure you take time to find the best one for your needs. That means a pro who -- in most instances -- is not paid a commission for the products he or she sells. Once you find the best ying for your yang, keeping up-to-date and on track is a cinch.

Twenty-one percent of those concerned with their overall debt have plans to make home improvements over $3,000, but more than one-third of these people don't know how they will pay for the home improvements they are planning.

"Home Is Where the Savings Is" could be the new needlepoint pillow on many a homeowner's couch. And while home improvements can be a boon (some upgrades can greatly improve resale value), making them shouldn't bust the bank.

Interestingly, 47% of the respondents think a home-equity loan is a financially responsible form of debt; 27% do not. Whether it's right for you depends on your situation -- no matter what the water cooler patter might be. Play a smarter rate game and don't do stupid things with your home equity.

And finally, LendingTree's survey found that the vast majority of respondents (almost 80%) believe that their future holds a life completely free from debt.

Exactly how will that happen when 19% of those concerned with their debt levels plan to purchase a car in 2005 and less than half make only minimum payments on their cards? Dealing with a pile of credit card debt can be overwhelming -- and a host of late-night commercials and bus fliers would make anyone think that it is nearly impossible without paying someone to do it for them. The truth is that getting rid of debt is simple. (Spend less money than you make!) But it's far from easy, as those on the Consumer Credit/Credit Cards discussion board can attest.

Of those respondents who indicate they will work to consolidate their debt in 2005, 38% are not sure how they would go about it. You've got to start somewhere. How about the Consumer Credit FAQ and the free Motley Fool Get Out of Debt Guide?

As with any resolution -- financial or otherwise -- you've got to start somewhere. Today, take one small step to find out how your money's working for you. And reward yourself with a shot of eggnog and some fruitcake.

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