We are happy to announce that the program has been a great success. We wanted to highlight some numbers from January and congratulate our top referring member.

Alex, our top referring member in January, has been with Mvelopes since September of 2006. He put an extra $320 in his pocket by referring friends and family to Mvelopes. The top 5 referring members received a total of $740.

Thank you to all the members who help us spread the word about Mvelopes.

If you haven’t taken advantage of the Refer-A-Friend Program, don’t miss your opportunity. Start referring your friends and family members today.

Tax Time

I have a Money for Life Coaching Client that purposely has extra money withheld for taxes so that he gets a larger refund at tax time.  During the year he relies on credit cards to get by if he doesn’t have enough income.  He carries a balance on those credit cards and then uses the tax refund to pay the balances off.  This may sound like a pretty smooth way to handle things, until you really start looking at how much this method is costing him.

First, he is allowing the government the use of his money throughout the year, rather than having access to it himself.  If he had this money in his bank account, he would have an easier time living within his income, and wouldn’t need to rely on credit cards to make up the difference.

Second problem is that by carrying a balance on his credit cards throughout the year, he is spending a lot of extra money on interest charges.  Using credit cards can be a great way to earn miles, points or extra cash, but its only effective if you pay off your balance each and every month so that you don’t have interest charges.

The third and final problem with this method, and perhaps the biggest issue, is that he was simply planning to overspend his income going into each year, rather than making the effort to live comfortably within his means.   Spending less than you make on a consistent basis is truly the best way to improve your financial future and increase your wealth.

After being introduced to Mvelopes and the principles of envelope budgeting, he is now dedicated to living within his means and is working to adjust his tax withholdings.  Hopefully this year he will realize that having that money available for his own use is far better than letting the government borrow it for a year without paying him any interest.

-Jennifer Streiff, Money for Life Coach

While starting over may seem like a great idea, this behavior is little bit like hiding your head in the sand.  Instead of learning from their spending habits and working to live within their income and their envelope balances, they are just cleaning everything out and pretending that it didn’t happen.

If you get behind in your Mvelopes account, or you over spend in a few areas… don’t hide your head in the sand.  Break the resetting habit and learn from your previous spending.  Use it as motivation to not get behind again and as motivation to log in more often so that you don’t overspend again.

One of the keys to not overspending is to know what your envelope balances are at any given time.  If you know how much money you have left to spend in each envelope, you can make informed spending decisions.  Logging in to Mvelopes frequently and keeping everything up to date will keep your information up-to-date and your envelope balances accurate.

If you get a little behind, spend some extra time and get caught up as soon as possible.  If you overspend in one area, transfer money from other envelopes until there are no negative balances. Only then will the information in Mvelopes help you build a more stable financial future.

Jennifer Streiff
Money for Life Coach

[photo courtesy of flickr / CC BY-SA 2.0]

Steven and his son

Recently, Steven (from New York) sent us the following comments about the success he has found using Mvelopes.

I’ve been using Mvelopes now for about 2 years. All I can say is that this application has turned my life around. Before Mvelopes I lived paycheck to paycheck–most of the time not having enough to pay all my bills. Since I started subscribing to the Mvelopes service I have gained a much better picture of my spending habits and have been able to learn and gain the discipline necessary to achieve my financial goals. I’m writing to you now having reduced my monthly bills, paid off all of my credit cards, and saved a five digit figure toward the purchase of a house. I am finally free of the endless credit cycle. Now when I want to make a big purchase, I can pay for it in cash knowing that Mvelopes will be there to help me track my purchases and continue to avoid getting over extended. Thank you to every member of the Mvelopes team for helping to create such a life-altering product.

In a follow-up telephone conversation I had with Steven, I asked him to share just a bit more information about his amazing success.  Steven answered the following questions.

Q:  How long have you been using Mvelopes?

A:  About two years.

Q:  How has Mvelopes assisted you in living within your income?

A:  It gives me a much better picture of my spending habits, for starters, and being able to categorize things into different envelopes is extremely helpful.  When your paycheck comes in, you have a predefined spending pattern.  For example, if I have a bill–let’s say my car payment–I know exactly what I owe and can divide that out.  I was not living within my income prior to using Mvelopes.  I was caught in the credit cycle, like many people today.  When I would have a life event happen (car repairs, etc.), because I was living paycheck to paycheck, I had to draw on my credit to pay bills.  I also played the “balance transfer” game, obtaining larger credit limits with lower interest rates.  At one point I started thinking, how am I going to dig myself out of this hole?  Eventually you get to the point when you realize that you’re so deep down into the hole that it feels overwhelming.  My grandfather lived to be 93 years old and he taught me that in order to get to the light at the end of the tunnel, you have to start walking.  I think that’s where the Mvelopes product really shines.  It takes away the fear.  It teaches you to start walking.

Q:  How much consumer debt have you been able to eliminate during that time?

A: I probably cleared up about $20,000 of consumer debt.  I estimated that it would take me about 10 years to get out of debt, and then I figured it would take me another 10 years to save, but I’ve been amazed at how quickly I was able to find success.

Q:  How much have you been able to save while using Mvelopes?

A: I have saved about $12,000 for a down-payment on a house.

Q:  How much has your average checking account balance increased while using Mvelopes?

A: In the past, the money in my checking out literally went out of the account as quickly as it went in.  I don’t believe my average balance was ever above $500.  My financial institution pays interest with a specific minimum balance, and now my balance never falls below $1,500 and can stay upwards of $3,000 for quite a long time.  The only reason the balance decreases is because I’ll occasionally transfer money to the house savings account.

Q:  What financial goals have you achieved while using Mvelopes?

A: When I started using Mvelopes, I had three separate goals.  First, I wanted to eliminate all high interest credit card debt by and adjust my spending habits.  I planned to make more than the minimum payment and close the accounts when I paid them off.  I am pleased to say that I have been consumer debt free for quite awhile now and I still don’t have a credit card.  I will not do that again!  My next goal was to eliminate all unnecessary loans.  I had a couple of loans that were kind of unsecured things.  Now I have one loan for the vehicle that I currently drive and, in actuality, I am making larger payments and will have it paid off in 3 years, rather than 5.  My third goal is to create a nest egg for starting a family and building a house.  Then I will start a retirement plan and build it.

Q:  What are your next financial goals?

A: I figure that since I’ve been able to accomplish what I have, my future financial goals are to become independently wealthy.  I want to get to a point in my life where I work because I want to, not because I have to.  I’ve decided to up the ante.  The area where I live is forever plagued with layoffs.  I have seen far too many of my friends get laid off from jobs where they have worked for decades.  I want to be in a position, at some point in my future, so that if I lose my primary employment, it’s not going to kill me.

Q:  How many envelopes have you created?

A: Somewhere in the range of 15-25.

Q:  How has Mvelopes helped to reduce financial stress?

A: One thing that it does is it makes reconciling my checkbook a breeze.  The overall concept really helped to reduce my stress, especially when I realized I was well on my way out of the vicious credit cycle.  I was able to take a breath and know that things truly were going to be all right.  Once I got a couple of bills paid off, I was able to take the money that I was spending on those and apply them to other things–and I was even able to occasionally treat myself for doing such a good job.

Q:  If married, how has Mvelopes helped you better collaborate with your spouse?

A: I started using Mvelopes prior to the start of the relationship I currently have with my girlfriend.  Once we got to the point in our relationship where we became serious, we sat down and talked through our financial situation.  We made things fair with the joint bills and we adjusted our automatic deposits to match.  We are probably the only couple I know that doesn’t fight about finances.  We make adjustments and collaborate probably on a weekly basis.  When you’re living paycheck to paycheck, you are constantly checking balances and worrying.  Now my financial world consists of focusing on things for about 5 minutes on a Saturday and if I’m not near a computer, I can always use the mobile version.

Q:  What advice would you give to new Mvelopes users?

A: Definitely go through the tutorials.  Once you’re through the tutorials, try to nail down the concept, and play with the application.  Don’t fear that it’s going to do anything with your money.   It doesn’t actually move your money-it just mirrors your account register, so don’t be afraid of it.  If you screw something up, there’s always the reset tool.  Help it help you!

Q:  If you could create a “tag line” for Mvelopes–keeping in mind what it’s done for you–what would the tag line be?

A: Well, as I just said, “Help it help you!”

I truly had a delightful time speaking with Steven.  His excitement about being free from the vicious credit card cycle is inspiring.  I especially appreciated the comment he shared from his grandfather.  Steven, thank you so much for taking time to speak with me and for sharing your success with us!  We wish you continued financial success and much happiness.

Mary and her family

Because of the increased interest in our coaching program, and because of its growing success, I’ve chosen to spotlight another coaching success story.  I recently had the privilege of speaking with Mary from New Jersey.  Mary and I discussed her coaching experience and her Mvelopes experience, generally.  Our discussion follows.

Q:  How many coaching Sessions did you complete?

A:  Ten.

Q:  What coaching session(s) did you find most valuable?

A:  The first couple of sessions were definitely the most valuable because they helped me better understand the system and how to work it and maneuver it.

Q:  How has the coaching program helped you take control of your money?

A:  I signed up for Mvelopes a few years ago–without the coaching–and I didn’t get very far with it because I didn’t really understand it.  I let the program sit dormant for awhile.  Then after receiving a couple of e-mail messages discussing the coaching program, I decided to try it.  After the first few sessions with Lori (my coach), I was able to really understand how to use the program.  In fact, it got me excited to use it.  I have tried to budget on my own for many (20+) years and I’m finally being successful!

Q:  How has the coaching program helped you reduce consumer debt?

A:  Consumer debt really isn’t an issue for me.  What was an issue was that my husband and I were living paycheck to paycheck and we needed to learn to better manage our finances.

Q:  How has the coaching program helped you reduce your stress related to money?

A:  Well, it’s been huge.  Now I have an envelope for all the expenses that we incur that maybe we don’t know we’re were going to incur.  And the really great thing is that if there isn’t an envelope created, but I find I need one, I can easily put one in place and know that sometime down the road I’ll have the money to cover whatever it is.  That has really helped to reduce a lot of stress.  Now, when my husband says, “We’ve got to do this …” or when we’re facing a costly repair bill, I don’t worry because I’ve got the money to cover it.  Things are getting put into place.

Q:  How much has your budgeting and money management knowledge increased since you started the coaching program?

A:  As far as budgeting and money management knowledge goes, I have always had the knowledge of how it was supposed to work, but I just wasn’t good at applying what I knew.  In the past, I’ve felt that money controlled me, and now I know how to control my money.  I’ve always felt that we never had enough money.  We were living paycheck to paycheck.  It was hard to save money.  Now we have a plan.  I’ve tried to budget by hand, without much success, but the computer and technology made it so much more effective.  I’ve found the right tool.  Visually it works for me.  It’s a fun program.

Q:  How much has the knowledge of the envelope method helped you manage your money?

A:  It helps me to be aware of where my money is going and how many envelopes I have.  Now I know why I never had any money before–it’s the awareness.

Q:  How have your attitudes about budgeting and money management changed since you started the coaching program?

A:  I’m much more relaxed now.  I feel I have better control.  So my attitude is no longer one of frustration and aggravation.  I have a much better attitude.

Q:  How has coaching helped you gain a clear overall picture of your spending?

A:  Awareness, again.  I liked the coaching more for understanding how to use Mvelopes–maybe not so much the nitty gritty of it.  Lori would go over the different points and she would help me implement those things.

Q:  How has your Mvelopes usage changed since starting the coaching program?

A:  I went from not using it at all–or very little–to using it pretty much every day.  I’m certainly no longer afraid of it.

Q:  What advice would you give to new Money for Life Coaching participants?

A:  My first thought is to definitely do the coaching.  Stick it out for at least 2-3 sessions.  It’s what I needed to get going.  Definitely use it.

After speaking with Mary about her coaching experience, I then asked her questions regarding her overall Mvelopes experience.

Q:  How long have you been using Mvelopes?

A:  Six months.

Q:  How much consumer debt have you been able to eliminate during that time?

A: I don’t have much consumer debt.  I have a line of credit that I still need to clear up, but Mvelopes has helped me develop a plan to pay it down.  I also have a car payment.

Q:  How much have you been able to save while using Mvelopes?

A: I haven’t been able to save.  It was a hard year because we didn’t have the money we’ve normally had to use, but we’re optimistic that we’ll be able to save in the future.

Q:  How much has your average checking account balance increased while using Mvelopes?

A: I was always close to being in the negative, but now we maintain approximately $5,000 in the account.

Q:  What financial goals have you achieved while using Mvelopes?

A: Peace of mind.  Now I know that I’m doing something positive about my financial situation.

Q:  What are your next financial goals?

A: To build a savings account.  I have one child in college and another one rapidly approaching that age and I want to have money for that.

Q:  If married, how has Mvelopes helped you better collaborate with your spouse?

A: This has always been our biggest area of argument, “Where did the money go?”  It has definitely helped in that area.  Now I have a plan and can better show and explain things to my husband.

Q:  What advice would you give to new Mvelopes users?

A: Sign up for coaching right away.  Take the money that it costs for coaching and put it in your envelopes.  Don’t get frustrated.  It will give you peace of mind.  It’ll give you a plan.

It was a pleasure to speak with Mary.  She is very enthusiastic about her future financial picture and she is confident that she has found the solution to her budgeting issues.  She is no longer afraid to face her finances.  In fact, she enjoys seeing the progress that she’s making as she successfully budgets her money.  Mary and her husband are no longer living paycheck to paycheck.  Keep up the great work, Mary.  We wish you and your family much continued financial success.

• Nearly 90 percent of survey respondents are moderately to very concerned about their ability to meet future financial obligations for major items, such as education and retirement.
• Seventy-three percent of respondents said their financial situation is about the same as (40 percent) or worse than (23 percent) when compared to the previous year.
• Sixty-six percent stated their approach to financial management is either reactive or simply total avoidance.  Only a small 34 percent follow a plan of action.

Here are 9 suggestions that you may want to consider for this upcoming year.  Now is the time to get control of your finances, and take that first step down the path to financial fitness. Why not start this next year off on the right financial foot?

1. Spend less than you make.
Just like you can’t loose weight if you take in more calories than you burn… you can’t save money if you spend more than you bring in.  Spending less than you make on a consistent basis is the key to reaching financial fitness and financial stability.  You can’t increase your savings, make investments, reduce debt or even make wise spending decisions if you’re consistently overspending your income each month.  Forty nine percent of respondents, to the financial fitness survey, said they rarely, if ever, use a budget to manage household spending.  No wonder they have so many challenges with overspending, increasing debt and lack of savings.

Put together a spending plan and make it one that works for you and your family!

For a step-by-step process of how to make an effective spending plan, look in the book Money for Life and its companion piece the Money for Life Success Planner.  These books walk you through the process and explain the reason behind each step, in a way that anyone can understand.  If you’d rather go the paperless route, Mvelopes® will help you create an online spending plan (www.mvelopes.com).

2. Save more… at least 10% of your income.
Ever hear of the theory of paying yourself first?  That’s basically what this is.  If you make it a habit to pull out 10% for savings and investments for retirement, before you pay any other bills, you are actively working towards a better financial future for yourself.  This 10% can include your 401k account if you have one, but be sure you are maximizing that option!  It’s also wise to put an additional amount into savings after your 401k investment is made.  Put this money into a money market account, money market fund or CD if possible, so that you get a higher interest rate.  According to Finicity’s Financial Fitness Survey conducted this past fall, 48 percent of respondents saved nothing in the past 6 months and 31 percent saved less than 10 percent of their income.  Don’t be one of the statistics, take action today and start saving!

3. Calculate your net worth.
Do a reality check to ensure you are on the right track. Your net worth should be increasing each year, even if it is just by a small amount.  The exercise of calculating your net worth can be very valuable as well… people often discover accounts, investments, etc that they have forgotten about, or need to update.

If your net worth has decreased from the year before, take an honest candid look at where you can make adjustments to improve these numbers.  Consider accelerated debt reduction.  Consider increased savings.  Even consider cutting up every credit card you have if it means that you stop overspending and start saving.  Be proactive in your efforts to get financially fit!

4. Start an emergency fund.
If you don’t already have an emergency fund, start one today!  Your emergency fund should have a minimum of 3 months worth of expenses in it.  This is your emergency money for a job loss, emergency repair, unexpected emergency medical expense, etc.  Keep these funds in a money market account or other high interest, easily accessible account.  If ever you have the misfortune of an unexpected job loss, unexpected car repair, unexpected appliance problem… you will be far more prepared to weather the storm if you know you have a little breathing room on your finances, thanks to your emergency fund!  That peace of mind makes all the difference.

5. Reduce your debt.
Use the debt roll down principle to quickly reduce your debt. Make a list of all your debts and prioritize them in order of interest (highest to lowest) or in order of the number of payments till payoff (fewest payments at the top).  Once your first debt is paid off, roll that payment amount into the next debt on your list. Follow the same procedure when the second debt is paid off.  You will not only reduce the number of years you will have payments, but you will also save thousands in interest if you follow this principle until you are completely debt free.

6. Use credit cards for the benefits, not the penalties.
If you use a credit card, only do so when you know that you already have the funds set aside to pay the balance completely when the bill arrives.  Do not carry a balance on your card!  It wastes money and ends up costing you a fortune in interest and finance charges.  Thirty Eight percent of respondents to Finicity’s Financial Fitness Survey stated that they never pay off their balance, and 33% only do so part of the time.  Are those airline miles really worth it?  Not if you aren’t paying the card off every month!

7. Make sure you have adequate insurance.
We’re talking home, life, disability, health, property and even auto.  Not too many other things will matter if you have no fire insurance and your house burns down.  Thirty Five percent of respondents to Finicity’s Financial Fitness Survey stated that they either knew they had too little insurance or that they weren’t sure what their coverage was.  Make sure that you, and your family, are covered adequately!

8. Create or update your estate plan and/or your will.
Whether you are single, married, divorced, kids or no kids… you need to have the proper documents to make your wishes known.

• Update your beneficiary info on your retirement accounts, insurance, etc.
• Specify money that you want to give to charity through a trust or gift exclusion.
• When preparing a will reference an addendum in the will where you list who will get your various assets and personal property.
• Make sure all language is clear and as specific as possible so that your wishes can be carried out.

9. Manage your portfolio.
If you have any 401k accounts from former employers, be sure you roll them over into an account that you control. Consolidation can also make your retirement accounts easier to manage, however, in doing so make sure you don’t jeopardize the diversification.  Tools like Mvelopes can help you keep an eye on all your investment accounts from one spot, quickly and easily.

Take advantage of the New Year and get on the path to financial fitness!

By Steven B. Smith, President and CEO of Finicity, the developers of Mvelopes and author of Money for Life – Successful Money Management and Financial Fitness in Just 12 Weeks and the Money for Life Success Planner – A 12-Week Companion to Achieve Financial Fitness.

Check Your Financial Fitness

With the New Year upon us, millions of Americans are making resolutions to improve both their waste line and their bottom line.  If you’re looking to improve your financial fitness this year, it’s important to first understand how you’re already doing.  The following quiz, taken from my Money for Life Success Planner, will help you understand how you’re doing financially, and where you can improve.

1. What percentage of your income do you save each month?
   1. 10 percent or more
   2. Less than 10 percent
   3. None
2. How often do you use a monthly budget to track and plan your spending?
   1. Almost always
   2. Sometimes
   3. Never
3. When you make a purchase using a credit card, how quickly do you usually pay off the entire balance?
   1. Immediately or before the end of the month
   2. Between one and three months
   3. I usually carry a balance from month to month
4. How many times during the last six months have you paid a bill late?
   1. None
   2. One to five
   3. Six or more
5. Most of your major purchases are…
   1. …planned in advance, with money set aside to cover them
   2. …planned even though the funds aren’t always there to pay for them
   3. …unplanned or spontaneous
6. If you needed to come up with money quickly to pay for a major home repair or an emergency, what source would you use?
   1. Funds already on hand
   2. Funds from available credit
   3. No funds available without establishing credit
7. If you lost your job or main source of income, how long could you provide for your basic needs and meet your financial obligations?
   1. Three or more months
   2. One to two months
   3. Less than one month
8. The insurance I have to cover the loss of major assets including real estate, autos and personal property is…
   1. …enough to cover replacement costs
   2. …less than enough to cover replacement costs
   3. …unsure or don’t have coverage
9. When was the last time you reviewed and adjusted your retirement plan?
   1. Within the last year
   2. In the last five years
   3. I don’t have any savings for retirement
10. When you think about your ability to meet future financial obligations, you feel…
    1. …completely at ease
    2. …moderately concerned
    3. …very concerned

Give yourself five (5) points for each time you answered “1,” three (3) points for each “2,” and one (1) point for each “3,” then total your score.  If you scored between 40 and 50, you’re in great financial shape.  If you scored between 20 and 39, you are off to a good start, but could still address some weaker areas.  If you scored below 20, you need to rethink your financial plan, and make some big changes.

Regardless of how you scored, now is a great time to sit down and examine your financial situation.  Write down your financial goals, and develop a plan of how to accomplish each one.

Steven B. Smith is the author of Money for Life: Successful Money Management and Financial Fitness in Just 12 Weeks! and the Money for Life Success Planner and creator of the Mvelopes Money Management system.



[photo courtesy of flickr / CC BY-SA 2.0]

New Year 2010

And how to actually keep them

Every January, millions of Americans determine to shed a few pounds and to finally get their finances in order.  Unfortunately, most estimates indicate that less than 30 percent of those well-intentioned resolutions make it through the year.  The reason most resolutions fail is because a plan is never laid out to help achieve the goal.  If you are serious about finally getting your finances in order this year, here are the three resolutions you need to make, along with easy steps to help you actually keep them.

1.  Automate your finances.

Why it’s important: If it’s not easy, most of us will quit before the New Year is a month old.  The key to effectively managing your money is tracking where it’s going, and how much money you have allocated for specific categories.  Paper and pen will do the trick, but be honest with yourself, do you plan on keeping that paper and pen with you for the next year, logging each and every purchase no matter how large or small?  The Internet allows you to track all your accounts with no manual effort, and will even do all the math for you.  If it’s automatic, you won’t get lazy, and you won’t forget to do it either.

Managing your finances online may also help keep your money safe.  According to a 2005 study on identity theft by the Better Business Bureau and Javelin Strategy and Research, “electronic monitoring provides greater safety by sharply reducing time to detection, and potentially eliminates the paper records and mail that are possible avenues to many identity theft cases.”

How to keep your resolution: Set up a secure online budgeting system like Mvelopes®.  Mvelopes will automatically track your expenses from multiple accounts and credit cards as well as provide you with balances for various savings and spending categories.  Seeing where you are spending your money will let you know where you can cut back.  Seeing your net worth rise in the net worth tracking feature will keep you motivated.

Set up automatic transfers with your bank to pay your mortgage and other fixed payments to avoid missing a payment or incurring late fees.  Use online bill pay to save on envelopes, stamps, and time. Set up an automatic transfer to a savings or money market account once a month.  Find a high interest bearing account to maximize your savings.

2.  Stop paying interest and start earning it.

Why it’s important: According to Bankrate.com, if you charge $1,000 on your credit card, and pay only the minimum payment (assuming an interest rate of 15 percent and a 2.5 percent minimum payment), it will take over 10 years to pay off and cost an additional $757.98 in interest.  Conversely, if you were to take only the amount you would be paying in interest each month on that loan and invest it in an account earning ten percent, it would grow to $1,594.92 over that 10 years.

Even if you’ve gotten deep into credit card debt and can’t pay it off quickly, you can save a bundle by lowering your rate, and paying more than the minimum.  By dropping the interest rate on your credit card in the example above to 11 percent and paying only $30 a month, you could pay off that $1,000 in just over three years with only $198.85 in interest.

How to keep your resolution: Always pay at least the minimum payment on time, and if at all possible, pay your credit card balance in full each month.  Mvelopes has a credit card tracking feature that automatically sets aside the exact purchase amount each time a purchase is made on your credit card to help you pay off the balance in full each month.

If you are carrying a balance from month to month, cut your spending to a minimum and allocate all the extra money you can to paying off your debt.  Use the debt roll down principle to quickly reduce your debt.  Make a list of all your consumer debts and prioritize them in order of interest (highest to lowest).  Pay the minimum on all your debts and pay as much as you can on the one with the highest rate.  Once your first debt is paid off, roll that payment amount into the next debt on your list.

Call your credit card issuer and try to negotiate a lower rate.  If they decline, let them know you plan to roll your balance to another card and cancel the card with the higher rate.  If your credit history is clean, you should be able to find a card with a 0% introductory APR.  Don’t make any purchases on the new card as often the introductory period ends as soon as you make your first purchase.  Be careful the interest rate doesn’t skyrocket after the introductory period, and make sure you cancel the card with the higher rate to avoid simply running up a larger debt load.  Check www.creditcards.com to compare credit card offers.

Check your credit reports to make sure they’re accurate.  The Fair Credit Reporting Act (FCRA) requires each of the nationwide consumer reporting companies — Equifax, Experian, and TransUnion — to provide you with a free copy of your credit report, at your request, once every 12 months. You can order your reports online at www.annualcreditreport.com or by calling 1-877-322-8228.

3.  Stop procrastinating saving for your retirement.

Why it’s important: Time can be your biggest ally when investing for retirement.  For example, if you begin at age 25 and invest $4,000 annually in a portfolio that provides a 10 percent average annual return, then stop contributing after 10 years, your investment will grow to $1,365,818.31 by the time you retire at 65.  However, if you procrastinate investing until you are 35, then contribute $4,000 annually in a portfolio with the same 10 percent average annual return, and continue to contribute every year for 30 years until retiring at 65, your investment will only grow to $759,775.11.  Even though you contributed $80,000 more over the life of the investment in the second scenario, you still ended up with $600,000 less.

How to keep your resolution: Contribute at least enough to your 401(k) to get the maximum company match.  Talk to your HR department to find out the details of your company’s plan.  If your employer offers a company match and you are not contributing to your plan, you are essentially turning down a bonus every year.  And since your contributions are taken out on a pre-tax basis, as you increase your contribution, your taxable income decreases, meaning you pay less in taxes.

Open a Roth IRA.  Your money grows tax-deferred, and just so long as the IRA has been open 5 years or more and you are at least 59 ½ when you start to withdraw, there are no tax penalties for withdrawal.

Make sure that no more than five percent of your portfolio for either your 401(k) or your Roth IRA is in a single stock.  Diversifying is the best way to ensure maximum growth over time while minimizing the risk and volatility of the market.  Select an index fund or target fund for an easy option that requires little oversight.

From start to finish. Regardless of where you stand financially, the New Year provides an excellent opportunity to review your finances and make improvements.  Make sure that this year you don’t just start fresh, but that you also finish strong.

Steven B. Smith is the President and CEO of Finicity, the developers of Mvelopes and author of Money for Life: Successful Money Management and Financial Fitness in Just 12 Weeks!

Mvelopes is pleased to announce their new refer-a-friend program. We know that our members are our best source for referrals, and we want to reward you for all your efforts. Starting today, we are offering the ability for members to quickly and easily send a message to all their friends and family, using popular social networks like Facebook® or Twitter™ or email, to let them know about Mvelopes.

If a friend or family member signs up using the link provided in the message, not only will they get a 20% discount off their first subscription period, but the member who referred them gets to pocket a cool $15. Not bad for a few clicks of the mouse, wouldn’t you say?

Want to get started? It’s easy, visit http://www.mvelopes.com/referafriend for all the details. We hope you have fun with this new program, and it can’t hurt to line your pockets with some extra cash as well!

Mvelopes

NEW FEATURES:

• Proposed Partial Reset
If you’ve ever been behind on transaction assignments, you’ve been daunted by the task of catching up. Now if you have more than 100 unassigned transactions sitting in your inbox, we will propose that you run a Partial Reset to help you get back on track quickly and painlessly. Following a Partial Reset, all you need to get back on track is Fund your envelopes. When you login the next day, we’ll you’ll be ready to assign any new transactions to their appropriate envelopes.

Proposed Partial Reset

• Proposed Funding of Available Funds
This is a simple reminder that gets presented upon login to tell you that you have a balance available in your Income Cash Pool to fund your envelopes with. This may be appropriate if you are living paycheck to paycheck. For those that fund their budget one or more months in advance, this window may not be helpful.

Available Funds

• Proposed Funding Using New Deposits
If you have new deposit transactions that are possibly income, we will propose that you fund your envelopes with these transactions. You can select the transactions that you want to fund with at that time.

Possible Income

• Insufficient Funds Notification
Many of our members have requested the ability to not allow envelopes to go into the negative. With this release, you will now be prompted to take cash from another envelope if there are insufficient funds in your envelope funding source. This Insufficient Funds notification will let you choose how to cover the expense.

Insufficient Funds

PERFORMANCE ENHANCEMENTS:

• Hide “Finance Charges” Envelope Preference
For those of you that use Credit Cards but do not incur any finance charges, we have added a “Hide Finance Charges Envelope” option to the Preferences.

Hide Finance Charges Envelope

• Match Filter Enhancement
We enhanced the Transaction Match Filter to take notice of the Date for the Pending Transaction that matches.