As 2011 rings out, it is time to reflect on the year gone by. It is also the time to look forward to the New Year. Use this year-end to review your financial scorecard for 2011 and make necessary changes to create an action plan to improve the score in 2012.

To do just that here are eight financial resolutions for 2012 you could begin with. You may pick and choose a few among these and implement -- add your own -- to improvise your personal finance management system.

1. Prepare a workable budget

You may choose to create a workable budget for 2012 by projecting your income and expenses. Also consider investments committed earlier like insurance premiums, SIPs and other commitments like loan EMIs. If you have any other financial goals to meet this year like buying a car or buying a property then sit down a while to check if you could make provisions for down payments.

The author, an MBA (Finance) and certified financial planner, is the director of Holistic Investment Planners(http://www.holisticinvestment.in) a firm that offers financial planning and wealth management. He can be reached at ramalingam@holisticinvestment.in.

2. Do a portfolio rebalance

2010 ended with the Sensex at 20,509. This year it is trading around 16,000. So definitely there is a need to rebalance your portfolio to restore your predetermined debt equity ratio. Probably you may need to increase your equity exposure. You can look at the current stock market downtrend as an opportunity.

3. Resist the temptation to make quick profits

Temptation to make quick profits is the biggest enemy of wealth creation. This temptation leads to speculation and gambling which in turn could lead to a huge loss. If you could take a resolution to resist this temptation you will not fall prey for bogus schemes that seem to offer huge returns.

4. Repay high cost loans

Do you have credit card debt, personal loan, or car loan? These are all definitely high cost loans. Why don't you chalk out a plan to repay these debts well in advance? This will reduce your debt burden. You can become debt free much before time. In return, you will have more investible surplus to invest for better returns.

5. Review insurance requirements

In the New Year please check if your life and health insurance is adequate or not. In case it is not find out how much additional coverage is required to make you and your dependent family feel secure.

If you have taken a term insurance policy through an agent, compare the premium you paid with an online term insurance plan. By buying an online term insurance plan you will definitely save up to 60% of your offline premium.

6. Plan to save tax on income earned

If you have not done your tax saving investments for the current financial year, you may decide to do it now. Without any further delay. As soon as the budget session is over create a tax plan for the next financial year. Going for tax saving investments in the last minute may force you to think only on saving tax and not on your financial goals and choosing the best scheme in sync with your financial goals.

7. Prepare a retirement plan

Don't put off today what you can't afford to do tomorrow. In spite of the world wide pension crisis and a growing acceptance that we must plan and save for our retirement, the harsh reality is we are actually not saving enough. Research reports reveal that only 15% of the individuals are saving sufficiently for their retired life.

Have you started planning for your retirement? You may be saying 'who me? I am too young to be thinking about retirement'. It is not so! Rethink your strategy. You should have started thinking about it yesterday because time flies quickly. If you were smart, and planned for retirement when you are young, your retirement years will be really those 'golden years'. If not you need to compromise and you need to work longer and retire later than others.

8. Avoid resolution pollution

You need to be very cautious about setting too many financial resolutions and also need to avoid setting unrealistic financial goals. You need to set a workable resolution. You need to keep realistic expectation on the outcome of the resolution. Over expectation may demotivate you. New Year resolution is not magic. You will be able to progress only over a period of time with constant practice.

Now that you have all the information needed to create your New Year financial resolutions, go ahead and create one for you and your family.

Well, if you want to share your financial resolutions for the New Year send a mail to getahead@rediff.co.in with subject line 'Financial Resolutions' and we will publish the best. Don't forget to mention your name and profession!