The new year is a great time. A magical time. Anything seems possible. Whether it’s a health target, a promotion in your career, or a money goal, the Christmas goodwill and downtime over the holidays help you feel like you can achieve anything in the new year…
But the reality is that most New Years resolutions fail. Inc.com reports our failure rate for New Years resolutions at over 80%. The reason why is pretty simple. Most of the resolutions we make require us to do important but not urgent activities. And that takes consistent work over an extended period of time, often some sacrifice, and, in most cases we don’t immediately see results.
So, to help make sure your New Years resolutions for your bank balance actually happen, I’ve outlined my top five resolutions below.
Resolution #1 Have A Clear Target In Mind
Saving is hard. But saving without a goal is next to impossible. The inner pleasure seeker inside every one of us knows that the most fun thing to do with your money is to spend all of it and a little more for good measure. So, if you’re not spending all your cash you need to be clear on why. Most of the time the reason is because you’re working toward something else that’s really important to you. Get clear on what that thing is. It’s important you put a number to it, so you know how much you need to have to mark your goal as done. Then keep that number, and your ultimate target front of mind as you do your saving.
Resolution #2 Break Your Big Goal Down
Depending on how big your target is, it may take some time to get there and it can be hard to keep your motivation up for an extended period. You can hack your thinking and keep yourself motivated by breaking down your big savings goal to a series of smaller goals. For example, if you want to save $100k for a home deposit, you could break it down into milestones of each $10k from where you are now and the ultimate target of $100k. This sounds simple, but it gives you a massive psychological boost as you can see clear progress toward your target.
Resolution #3 Go Granular
This is an extension of the resolution above, but an important one. Here you should look to break down your milestones further into the week-to-week or month-to-month goals. This gives you crystal clarity on what you need to do this week or month to achieve your milestones. This will help drive motivation even further, as you can see the smaller steps you need to take now to hit your milestone targets. The other advantage of having a more granular target means that if you get off track, you can write off that week or month, and get back on track in the following period without having to toss out the entire goal.
Resolution #4 Celebrate Your Wins
Anything that’s important and truly worthwhile is probably something that will take some time and a fair bit of work. This means you’ll often need to keep yourself motivated for an extended period of time. One hack you can use to keep your motivation up is to celebrate your progress. This is something most people are bad at, with high achievers being the worst offenders. You end up so focused on the end results you’re working toward, it’s easy to fall into the trap of just thinking about how much work we need to do to get there.
An extra benefit of resolutions two and three is that you have some small, clear, granular milestones that you can use as points to celebrate on the path to your ultimate goal. Having some sort of reward at your key milestones will keep you excited, give you some mini victories, and massively increase your likelihood of achieving your target.
Resolution #5 Buddy Up
Like with anything important that takes some hard work to achieve, going it alone is hard. Having someone in your corner can make it easier. Your buddy can help share their experience, push you forward, or pull you back in line if you get off track. Rope in a mate, your partner, a family member, or a professional adviser or coach. You’ll get the benefit of having someone to support you on your journey, and to be there to support you when you need it.
The new year is an exciting time. And anything often is possible. But it won’t just happen on it’s own. You need to be prepared to put in the work. But, give yourself an advantage by using the framework above to hack your thinking, drive your motivation, and ultimately make it easier to achieve what you want.
I promise your future self will thank you for it.
Disclaimer: The information contained in this article is general in nature and does not take into account your personal objectives, financial situation or needs. Therefore, you should consider whether the information is appropriate to your circumstances before acting on it, and where appropriate, seek professional advice from a finance professional.
Image Credit: Christian Vierig/Getty