Seven ways to simplify your life and boost your net income in 2008

January 1, 2008

There's no need to make ambitious but unattainable promises. Here are seven steps you can take to simplify your life, lower expenses, and pump up your net income in the new year.

Key Points

The trouble with New Year's resolutions is their limited shelf life. By the time you read this, most 2008 resolutions will be little more than hazy memories. The main reason for such lack of commitment, say the experts, is the impossibly difficult demands that most New Year's promises place on well-meaning but naïve pledgers.

When it comes to your practice in 2008, there's no need to make ambitious but unattainable promises. Here are seven steps you can take to simplify your life, lower expenses, and pump up your net income in the new year.

1. Slash costs for keeping in touch

Unfortunately, you're probably paying a lot more than you realize for all that techno-communication. If you're like most professionals in practice, you added individual services one at a time, paying top dollar for each. One way to lower these costs is to take advantage of the bundled plans now offered by most providers.

Contact your primary provider to see what bundled plans are available in your area. In addition to saving you money, dealing with one company will greatly simplify your bill-paying procedures.

2. Give your accountant a pay cut

Sure, you hate all that paperwork and recordkeeping that have become part of your life. Don't we all? Nevertheless, if you find yourself scrambling to find receipts and other records for your accountant at tax time every year, you're probably costing yourself some real money.

Chances are that business records for your practice are well organized, but that may not be true for your personal tax records. Tom Normoyle, a certified public accountant in Huntingdon Valley, PA, said that even the simplest of systems, one file for income and one for deductible expenses, can be a money saver.

"When clients present me with a shoe box full of unsorted papers, I have to charge them for the hours it takes to make sense of them," he said. "A simple filing system that separates records of different types is one sure way to reduce my fee."

And remember, accountants like things to be in balance. So make sure that you reconcile your bank statements each month. This step reduces fees by eliminating time spent tracking down unaccounted for outstanding items.

3. Save money while paying bills

No one enjoys paying bills. That's why we sometimes postpone that unwelcome job to the point of risking late payment fees and blemishes on our credit reports. Paying bills never may be fun, but new technology has made the task quicker, easier, and a little less costly.

Nearly all banks are online these days and most offer free (or almost free) online bill paying. Once you sign up and choose a password, you log on to the bank's Web site, where you enter the payee's name, address, phone number, and the amount to be paid. The bank takes over from there, either by mailing a check to the payee or by making an electronic transfer of the money.

You save precious time, the cost of postage, buying checks, and trips to the post office. The use of this technology can be a money saver in both your personal and professional lives. What are you waiting for?

4. Slay the credit card monster

Life as we know it today wouldn't be possible without credit. Credit, however, has its dark side as well. Credit cards have been compared with drugs; they offer short-term pleasure in exchange for long-term pain. A pocketful of credit cards can sweep you up in the illusion that you have more money than you actually have. This is true even for successful professionals.