The new year is a good time to take stock of where you are in life and where you want to be, writes financial planner Pieter Willem Moolman.

The casual resolutions – to stop smoking, lose weight or get fit – seemed easy enough on New Year’s Eve, but now your plans must be put into action.

Likewise, this period is critical in terms of your personal financial planning and it is worth going through a simple checklist. Once accomplished, you are free to focus on tackling that new fitness programme or handling your nicotine cravings.

First of all, do you have a will and is it up to date and practical to execute? Find your copy and read through it.

Secondly, do you have a savings plan to boost your retirement? If you don’t, start one – and if you do have one, consider a small monthly increase.
With the tax year ending in February, now is the right time to look at your retirement annuities. Are you making optimal use of the associated tax benefits?

Thirdly, look at your short-term insurance and ask your broker to review the values. This could free up R100 per month, which could be added to your savings.

Make sure you’ve added and specified the iPad you got for Christmas – and your son’s new bicycle.

Take a fresh look at your risk cover – will your family be taken care of if something were to happen to you or your spouse? Severe illness or disability could be disastrous for a family.

Lastly, involve your family in updating your personal budget. It is an invaluable financial lesson for your children to know what you pay every month for the telephone, electricity and school fees.

Review their pocket money – give them a small increase and explain that the cost of living goes up for them too.  Encourage your children to save.

A good example of saving over the years comes from a Moneyweb article entitled “The reason why yuppies retire poor”, by Sanlam’s Frederick White.

White gives the illustration of two friends, Pete and Sam. Pete, who started smoking at university, smokes a packet of cigarettes per day at a current cost of R25 per packet.

Sam decides to contribute an additional sum – equivalent to what Pete spends on cigarettes – to his equity portfolio. This amounts to just over R9 000 per year and Sam keeps on doing so for as long as Pete keeps on smoking.

Since smoking attracts an ever-increasing “sin tax”, let’s assume that the price of cigarettes will grow by 1% more than inflation every year.

If Pete never quits smoking then, with some basic assumptions, Sam will have an additional R16 million more than Pete at retirement, or R1.6 million in today’s money.

The financial resolutions you make today will have a powerful effect on your future. These easy-to-do suggestions will ensure peace of mind in the year ahead.

Pieter Willem Moolman is the owner of PWM Financial Management in Port Elizabeth. Visit or phone 041 582 3034.