Money focus: How can I stick to my money resolutions?

Money focus - keeping your money resolutions

Each week we ask a question to help you focus on an area of your finances that might need a closer look. This week: How can I stick to my money resolutions?

Okay, so where did the first two weeks of the new year actually go? It feels like one minute you’re lighting sparklers to the tune of ‘Auld Lang Syne’ and the next you’re here reading about how you’ve already lost your way with your money resolutions. Bam.

Does it help to know that most people have already given up on their new year’s resolutions? By the end of this month, two-thirds of everyone will have abandoned their efforts. Eventually, 93 per cent will have given up before reaching their goals.

Whether you find those stats alarming or comforting really depends on how much you want to achieve your money resolutions this year. I’m hoping you find them alarming. I’m hoping you’re saying to yourself right now, “I’m going to be among the seven per cent of people who make it.”

The fact is, this year you can be the seven per cent. You can achieve your money resolutions and then some. It’s all a matter of knowing your what, your how, and especially your why.

Know your why

Making your goals your new reality is all about your ‘why’.

Why have you set these particular money resolutions?
Why does achieving them matter?

Hopefully you’ll already know the answers to these questions. If you’re not, it’s worth revisiting this money focus: Money goals: How to set your financial goals.

Just remember, the more you can align your money resolutions with your values, the easier you’ll find them to stick to. Explore these concepts further here:

If you’re still having trouble teasing out your ‘why’, go see a financial adviser. They’ll ask you a ton of questions to really get you thinking about what you want your money to do. Your why will soon be revealed.

Know your what

You know why you want to change, but have you considered exactly what you need to change? What’s your plan? You do have a plan to achieve your important money resolutions, don’t you?

Your ‘what’ is your exact goal. So, you might have the ‘why’ of ‘I’m tired of struggling pay check to pay check so I want to save more‘. Your ‘what’ is the ‘what am I going to do about it?’ part. In this case, your ‘what’ might be, ‘so I’m going to save 10 per cent of my salary every month’.

In other words, your what is your tactics, or the things that form your actual money resolutions.

I resolve to save X% by June
This year I promise to put $Y into my super each month
I’ll pay off my debts by the end of the year
I promise to not spend money on Z for three months

Whatever it takes to change your habits and reach your goals:

Know your how

Sad though it seems, changing your money habits isn’t as simple as clicking your fingers at the stroke of midnight and declaring that things are going to be different.

Different year, same you.

Just because you resolve to save 10 per cent of your income, doesn’t mean it’s going to happen. Especially when something tempting comes your way to spend that 10 per cent on instead.

Change is hard. It’s really, really hard. The only way to make it manageable is to keep things:

realistic
achievable
consistent

There’s some help to do this here:

For the most in-depth help you can find to change your habits and make your money resolutions come true, go see James Clear. He’s the master of habit change and he’ll show you how small, consistent changes in the way you spend your money can make a huge difference over time.

Start small, one habit change at a time. And go from there.

Find the rest of our Money Focus series here.