Plan Ahead to Improve Your Finances By Linda Stern WASHINGTON (Reuters) - Any ambitious endeavor is more likely to succeed if it is well planned. So, this year, instead of resolutions, write down some financial plans for 2005. Here are five to keep you on track when willpower fades along with those January promises. 1. Write an investment policy statement. Do this even, perhaps especially, if you have someone else managing your money, suggests Gary Hager, a money manager in Edison, New Jersey. And be as specific as possible. Include the following: What goals you are investing for, and how far in the future they are; how much risk you're willing to take; your tax situation; the social values you'd like your investments to embody; and the philosophy that underpins your investment behavior. For example: Do you intend to review investments monthly and shift in and out of companies based on the news and earnings reports? Or do you want a stable portfolio of mutual funds that you will rebalance only annually? Having a detailed, written investment policy will protect you the next time a pal recommends "a sure thing" or you encounter a bad broker. 2. Write a charity plan. Chances are you've written a few checks to charity in recent weeks. First there was the tax-motivated year-end giving; then the neighbor who was collecting for... whatever; then the tsunami hit and you opened your heart and that checkbook once more. It's all good, but it could be better if you structured your largesse. Sit down at the beginning of the year, look at how much you gave last year and apportion it, and more, over the year to come. If you plan in advance, you can give larger amounts to fewer charities; thus increasing the impact of your money and decreasing your mailbox load. Perhaps set some policy goals -- say 50 percent for religiously connected charities; 30 percent for health; 10 percent for the arts, and 10 percent held back for emergency or spur-of-the-moment donations. You could also decide not to give to any group that hounds you for money, or that doesn't have financial practices which pass muster at http://give.org, the Web site of the Better Business Bureau's charity watchdog agency. 3. Write a credit restructuring plan. Decide how you will use the credit resources available to you, including credit cards and a home equity line of credit. Determine which expenses you will charge and which ones you won't, and what kinds of card rewards you care about and what kind you don't. Create a realistic pay-down plan. Once you've written it all down, you can take some actions to really shrink your debt. Collect all the mail you're about to receive from credit card issuers. Find the one that offers the best deal on balance transfers, and use that account to wipe out your holiday spree. Authorize a regular draft from your checking account to make sure that pay-down plan is put into effect. Choose another card with the right rewards and use that one for day-to-day expenses that you'll pay off monthly. 4. Write a spending plan. This is not the same thing as boring budgeting, nor does it require you to determine ahead of time where each dollar goes or how many lattes you're allowed to drink in a month. But it should force you to confront your priorities. Look at how much you spent last year on life's necessities -- food and fuel and savings and mortgage payments. Determine where you want the rest of it to go; plan to spend on that new car or family vacation if it's important to you this year; allow a slush fund for the occasional fun splurge.     Continued ... Quelle "Plan Ahead to Improve Your Finances" : reuters.com Main page for "Plan Ahead to Improve Your Finances"