As the year draws to a close, many of us begin to look into their financials to get a better view of how they fared in meeting goals and where they stand heading into the new year. This exercise can be stressing for those with much debt and no income increase on the horizon. This debt may present itself as a hurdle in the way of setting new goals. But it doesn’t have to be this way, because a combination of spending restructuring and an understanding of your financial circumstances are the only way that you can be financially sound and avoid getting into a whole new bunch of commitments.

So before you buy to a year-long gym membership, upgrade your car, or enroll for continuing-education courses to advance your professional status, take a good look at your financial resources. Make sure that these new commitments – especially the long-term ones – are affordable and warranted. If you’re just driven by the need for change or an attempt to make a lifestyle upgrade, don’t invest too much too soon.

Here are a few points to think of while you’re working your new-year resolutions from a financial perspective.

Record

Although it is good to be persistent, there is a certain point when you should stop pumping money into something that always reaches a dead-end. Fascination with joining in-fashion fitness classes, buying new gadgets, paying for membership at clubs or stores are all examples of what many people subscribe to early in the year in association with their success, fitness and social goals. But they often may never follow through on making a full use of such activities or perks.

Think of each of such purchases in terms of type. If you’ve done something in the past successfully and enjoyed it, it may make sense to invest into or engage in something similar. If your previous attempts always were based on a whim and were simply a waste of money, it may be time to invest into some actual steps before putting any extra money into the same type of activity.

Commitments

If you’re just beginning a new routine or trying something new – be it a new fitness program or even a new job – don’t commit too much financially until you see how it materializes. A good example is to not buy a house in the proximity of an office where you’ve just started a job. Although you always should be full-heartedly invested in whatever you do and expect that you’ll succeed in it, don’t rush to a long-term commitment until you’re sure that is what you want to do.

Your financial commitments also should be based on your ability to foresee external events. For example, if you’re in a shaky economy or working for an employer who is struggling, keep your plans simple and include an exit strategy for your strategies. By doing so, you shield yourself against the ups and downs that are beyond your control while you still get what you want to achieve today.

Starting over

A new year is a good time to review some of your ongoing financial decisions, which may include taking a good look at your big-expense items such as rent, transportation, etc. If you’re taking this new beginning seriously, be ready not only to cut back on your expenses, but also to make change to the way your prioritize your spending. For example, if your new-year resolutions are pointing to your increased interest in quality time with family, you may consider moving closer to your work to cut on your commute time, which in turn may incur a higher rent.

As you match your priorities with your expenses, you will have to find areas that can be trimmed to pay for the increase in other categories. Although this means that you may be giving up some luxuries, it also should lead you to have a more fulfilling life that is still based on the same amount of income.

Rania Oteify, a former Gulf News Business Features Editor, is a Seattle-based editor.