It's that time of year again and we're talking about New Year's resolutions.
Many of us make resolutions to lose that extra weight or make a career move to help us get in shape and follow our dreams, but what about our goals for our finances?
We've put together our top tips to help you set, and keep, your financial resolutions this year.
Consider your values and set goals that reflect them
The whole point of setting a goal is to reach for something you want and have the ability to achieve. If one of your values is freedom, it might make sense to have a goal be to pay off your debts and retire early. If one of your goals is to spend more time with your family, maybe it makes sense to set a goal of saving for a family vacation. Once you reflect and let your values guide your goals, it's time to put together a plan to meet them.
ADVERTISEMENT
If you're feeling stuck on how to create a plan that works for you, reach out to your financial adviser for help.
Create short-term goals to build up to bigger ones
If your goal is to buy a house or save enough to pay for your child or grandchild's education, those goals can feel so big that they're almost unattainable. It's easy to get frustrated and give up when it feels like these goals are so far from reach, but by breaking them up into manageable chunks, you may find that you're more likely to meet your financial goals.
Let's say your goal is to take your family on a vacation next year and it's going to cost you $10,000.
Instead of having your goal being to save $10,000 by the end of the year, set goals to save $883 a month, or $192 each week. This way, you're more likely to meet that big goal because there is less room for procrastination.
Write it down
This is a big one. It might seem insignificant, but we tell clients all the time that writing down your goals is a great way to stay accountable and on track. Write down your goals on sticky notes, a white board or any other surface that you see regularly. Keeping your goals top of mind means that you are less likely to forget about them and more likely to take steps to check off that financial goal from your list.
Don't just take it from us, a Harvard Business Study found that the 3 percent of graduates from their Masters of Business Administration who had their goals written down, ended up earning 10 times as much as the other 97 percent put together, just 10 years after graduation. If it worked for these students, it could work for you too. Write them down.
ADVERTISEMENT
Set up direct deposits to help stay on track
Another way to help ensure you keep your financial resolutions is to set up a separate bank account and use a direct deposit to automatically send a portion of your paycheck to the account. The out of sight, out of mind mentality could help you avoid overspending or finding other uses for that income.
With these tips and a little willpower, you will be setting and keeping your financial resolutions come next December.
