Smart Money Lessons From Everyday Savers

We're a few weeks into 2012, and millions of Americans are still working hard to stick to their New Year's resolutions. Unsurprisingly, many of those resolutions revolve around improving their personal finances.

Let's hope people stay committed. Despite some good economic news over the last couple months -- particularly the drop in the national unemployment rate -- many average American families are still staring down tough financial straits.

Unemployment is still at a too-high 8.6 percent. For the average U.S. household with credit card debt, their outstanding bill is nearly $15,800. And, most distressingly, the Census Bureau recently reported that 46.2 million Americans are now living below the federal poverty line -- that's the highest total in the 52 years the agency has been publishing the figure.

One of the biggest reasons many people have trouble improving their finances is that they've fallen victim to a fundamental misunderstanding of how wealth works. Too often, prosperity is seen as the result of a single major windfall -- the new job, the big raise, an inheritance, winning the lottery, etc.

And while landing a large lump of cash is nice, wealth isn't really about big wins -- think of all those stories about lottery winners that wind up declaring bankruptcy. What's really important for building a strong nest egg are habits -- those daily, unsexy micro-decisions you make with your money.

ING DIRECT Investing just wrapped up an online "Gettin' Things Done" contest, in which we asked average savers and investors from across the country to tell us what habits they've adopted to shore up their finances. We received hundreds of submissions from people in all walks of life. And the winners provide some keen insights into how to firm up your own finances.

The best submissions all revolved around three simple words: automate, automate, automate. We'd all like to have the self-discipline to make responsible savings decisions. But once that paycheck clears and you're, say, out at the bar or shopping with friends, even for the most committed, it's tough to stick to long-term financial goals. It's much easier to just splurge and promise ourselves we'll save better in the future.

Automating saving and investing helps -- a lot. All it takes is a little bit of paperwork and you can have a preset slice of your paycheck automatically diverted to your savings account and investment vehicles, like an IRA or 401(k). That way, no matter what else you do with the rest of your salary, you will have "paid yourself first."

One of our contest winners, Renee Marx, recounted how when she and her husband got married in 1985, they started a savings plan and at "the beginning of every year we decide how much to put away each month and set it up automatically. As long as our savings goal is met he doesn't care how many purses I buy and he sleeps without worry."

The plan worked great. Renee and her husband are on strong financial footing. And they recently "celebrated 25 years of wedded bliss."

Karen Smith had a similar story. "I have my husband's check deposited automatically into an account for our bills," she wrote. "This system has worked well for us for over 15 years."

These couples are onto something -- finances are often a major stressor in marriages.

Another big theme among contest winners is incorporating small cost-savings measures into daily routines. Those small savings might not seem like much at the time. But after a year -- or ten years -- they can add up to a huge chunk of change.

One of the more straight forward recommendations comes from Joshua Mustacchio, who told us that "every time I break a dollar I put the change into a piggy bank." Likewise, Sherree Flowers keeps "loose change and either on a weekly basis or a monthly basis total[s] the savings and add[s] the savings to grow [her] penny investment account."

Winner Angel Ho makes a point of "exchanging service with [her] friends or neighbors," like "exchanging gardening service for baby-sitting." She also recommends that if you like cooking, "cook your roommate a dinner in exchange for cleaning up the dishes or vacuuming the carpet."

Smart, commonsensical cost-cutting techniques like these can reap big financial rewards over the long term. And they don't require you to radically readjust your behavior.

Strong finances are enabled by good habits. These suggestions from everyday people can easily be incorporated into your financial life. Take control of your finances in 2012 -- one small decision at a time.

Dan Greenshields, CFA, is President of ING DIRECT Investing, a subsidiary of ING Bank, fsb.