Christmas is over. You are still basking in the good feeling of family celebrations, wonderful gifts, and neighbourhood spirit of giving. But, now it is back to the ordinary, mundane chores, and the daily circle of life achievement for your family and yourself.Holidays, the enforced closure of work activities with wages, are a great idea. They give you that freedom mentally and physically, if only for a little while, from the responsibilities of a job, budgets, bills, and deadlines.As the year winds to a close, what are your thoughts for next year? Are you the kind of person who likes to plan ahead? Do you set goals, or just go with the flow? Are you anticipating positive changes for your family environment, or worried about your job challenges in this very uncertain economy?An excellent way to start the New Year is to review your personal financial profile. Oh, oh, sounds like homework, but it doesn’t have to be. Take a different perspective. Putting your financial affairs in order means a first class start for achieving a new goal in the New Year.Personal finances can be grouped into six different classifications: Cash flow, debts, investments, insurance, legacies, and taxes. The top concern for most of us, though, is cash and debt management. Families severely pressed to meet a monthly budget seldom have time (or resources) to consider the remaining four categories. They have all they can do to cope from day to day.Where do you start? With the basics and with the obvious, your cash inflows and outflows. Take a walk through your entire year’s bank statements, obtained online or on paper. Did you think your holiday spending went out of control? Don’t beat yourself up too badly; almost everyone experiences some post-holiday remorse. It is extremely rare to hear someone say that they underspent their holiday budget. If your bills have increased, you need to figure out how it happened, what you splurged on, and set some parameters for next year’s cash management. So, set yourself up with a work surface, a comfortable chair, a beverage of your fancy and begin.Most people hate this sort of financial review because it becomes emotional: frustration that you didn’t live up to other’s expectations; dismay that you spent more than you thought; and fear at the prospect of settling these holidays bills. The perceived chore feels like punishment to revisit your financial activity as virtually, no one wants to input all those numbers line by line into a spreadsheet. Contradictory creatures that we are, we will make time to plan a vacation and comparison shop bargains. No punishment there, only pleasurable thoughts.The way to construct a quick budget is quite easy. You need to get through 12 months of bank statements (groan) by taking the review in steps. Work with the bank account (statements) that you use the most, that is the account that deposits your income each month and expenses all your payments.1. Line up a blank page into 12 columns label one for each month. After review of steps five to eight using your bank statements below, do steps two to four.2. Below each month’s heading on the first line, you will place your monthly income total.3. On the second line, you will place the total withdrawals (expenses) by month (as discussed below).4. The third line will show the difference between the income and expenses for each month.5. Look at either the top or the bottom of each bank statement. There listed will be the total of all deposits (income) make a note of each month’s total as in step two above.6. Now look at the total of all withdrawals (expenses) make a note of each month’s total as in step three.7. Now compare your total income each month by the month for the 2011 year. Generally, your income will remain pretty constant each month, so use one month’s income figure for your 2012 income budget number.8. Next, compare the total withdrawals each month by month for the 2011 year. We tend to be creatures of habit when it comes to daily living, allocating so much for standards: food, utilities, gas, rent or mortgage expenses, etc. Where we run aground is excess phone charges, credit card splurges, unnecessary purchases, and treats (did you really need those new shoes, smartphone). In your comparisons, if you see three months, each within the same range of expenses (indicating fairly normal expenses groupings), then one of two months that are significantly higher, with this pattern repeating itself, these are the expense areas to review in detail.It shouldn’t take you more than an hour for a first run through of these bank statements, assuming you have them all.Why were your expenses out of control in those higher cost months? Did you forget about annual car licensing, or property taxes, or life insurance premiums, or was it just another euphoric Christmas season? You may also be withdrawing amounts to actually transfer to savings accounts. Those numbers won’t qualify as expense, but a good savings habit. However, if these high spending months aren’t caused by those once a year budget busters, or a regular withdrawal savings regime, then you may need to justify if these extra expenses were necessary.What have you discovered by this exercise? Are you pretty consistent across the entire year, both in income and expenses? Or, are you erratic, controlling your spending one month, while ramping up splurges in the next? Only you know the answers to this intensely personal financial review. Only you can take the next step to control how you want to manage your financial life. You know how now take action.The musical genius John Lennon’s song, “A very Merry Christmas, And a Happy New Year, Let’s hope it’s a good one, Without any fear” is a timely message for the year ahead. We wish all readers the choice to live your very best lives ”without any fear” in 2012.Martha Myron, CPA CFP (US) TEP JP www.marthamyron.com is an international Certified Financial Planner™ providing Financial Counsel for Cross Border Living™ on international tax, estate, and retirement strategies for Bermuda residents with US connections, and US citizens living and working abroad. Member of the American Citizens Abroad Tax Advisory Council. www.americansabroad.org Contact mmyron[AT]patterson-partners.com or 296-3528 at Patterson Partners Ltd.