Keeping a financial New Year’s resolution takes… well, resolve. So many people aim for the moon, only to give up before they finish building a rocket ship. Those promises you make to yourself every January may seem like a done deal at the time, but ask yourself: How are you doing on last year’s resolutions?
To put it simply, keeping a New Year’s resolution is the exception rather than the rule. In fact, only 64% of people make it the first month.
But it’s not impossible, and there are plenty of things you can do to even the odds. If you’re looking to make – and keep – a financial resolution this year, read on for some tips on how to succeed.
Make It Automatic
Making and keeping a resolution requires more self-control – a commodity that's frequently in limited supply. Make your goal automatic and it will be more easily achieved.
For example, if you want to invest 5% of your salary in 2017, change your payroll settings so that amount automatically funnels into an IRA or 401k. Don't just assume you'll do it manually every month. Making your financial resolution automatic takes self-control out of the equation entirely.
If you don’t want to change your payroll settings, Apps like Digit can also do this for you. Digit is a cool app that automatically saves money for you. It analyzes your spending and moves money into a savings account. It’s a great way to automatically save. Check out Digit here (it’s free).
Keep It Realistic
Making a new year's resolution is often like promising to stop drinking after a bad hangover. It's a vow made in the moment with little consideration on how you'll keep it later.
Instead of proclaiming that you'll save $1000 a month or pay off your mortgage in under a year, create a realistic goal. For example, look at your budget and determine where you can make changes. See what you can realistically cut, and use that sum to determine how much you can save or pay off.
We recently talked about how to pay off $10,000 of debt in one year. That may not seem like a realistic goal at first. But, if you break it down by month, you now realize you’re only shooting for $833 per month. That’s more doable.
No matter what your realistic goal is, you need to be using the right numbers. Make sure you have a system in place to track your finances. We recommend the free tool Personal Capital. It’s an app and website that allows you to connect your bank and investing accounts, and it monitors them for you. It’s easy to use, and it’s free. Check out Personal Capital here.
Keep It In Mind
Studies show that people who write down their New Year’s resolutions are ten times more likely to keep them. After you write down your resolution, post it where you'll see the reminder daily. Check out Robert’s post here for inspiration.
Michelle Schroeder-Gardner of Making Sense of Cents also recommends creating a “vision board and placing it in a prominent place so you are forced to look at it often.”
You can also set calendar reminders to check in on your goal and see if you’re still on track. Whatever works best for you is fine; the important thing is finding a way to remind yourself on a consistent basis.
Use Technology To Your Advantage
Maintaining a financial resolution is easier than ever, thanks to saving, debt and budgeting apps that have become ubiquitous in recent years.
Apps like Personal Capital, Digit, and Qoins can help you stay on top of your finances. For example, if you’re having trouble budgeting, Personal Capital will send you spending alerts. As long as you have your phone, you’ll have the ability to check your budget.
Find An Accountability Partner
Keeping a resolution is hard – especially if few of your friends and loved ones support or understand your goal. An accountability partner with a similar resolution can help you stay on track, and remind you why you created your resolution in the first place.
Beyond just keeping you accountable, an “accountabilibuddy” can be someone to vent with and compare frustrations. Sharing the struggle will help to lighten the load, serving as a constant reminder that you’re not alone in your journey.
To find a partner, you can join a group on Facebook or ask someone you know who’s trying to do the same thing. Find a regular time to meet in-person or virtually to go over your goals.
For example, the Frugalwoods have had immense financial success practicing frugality without feeling deprived. This month, they are hosting an Uber Frugal challenge for a month. This challenge can help you lower your costs and discover alternative ways of utilizing your money.
You can sign up for the challenge here.
Another online challenge is our friend Stefanie O’Connell’s Cash Confidence Challenge. It’s a free challenge that is designed to inspire accountability as you work out your budget.
Keeping your New Years’ Resolutions can be tough. But remember – you promised yourself this for a reason. These resolutions probably weren’t for someone else – they were for you personally. Don’t let yourself down. Take action this year to make it happen.
What's the biggest hurdle you've had to overcome to reach your goals?