new year's resolutions

The Complete Guide to Successful New Year’s Resolutions

The New Year is almost upon us! You may feel like this year has flown by and that the prospect of a new year is overwhelming. However, it just means that the opportunity for a fresh start with some well-thought-out New Year’s resolutions is right around the corner.

Now is the perfect time to look at how you can prepare for the dawn of a new calendar year. If you want to successfully set and achieve your New Year’s resolutions, here’s what you need to know!

Start By Taking Inventory

Sometimes, you must look at where you’ve been to get where you want to go. Not only can this help you figure out what you need to work on, but it can also allow you to see what may have caused you difficulty in the past.

Here are a few things to take inventory of before you start setting your New Year’s resolutions.

Reflect on Your Successes and Failures

If you set resolutions for this current year, it’s important to look at your progress toward achieving them. This is because one of the key reasons people may fail to reach their goals is that they aren’t being specific enough about their goals.

Alternately, it’s possible that you really wanted or needed to work on something else, not what you were striving for. For example, let’s say that one of your resolutions was to save for retirement and build an emergency fund. Let’s also say you’ve been doing great on the former, not the latter.

Take a look at the difference between the two. You’re likely to find the reasons behind your lack of success and can use that information to create your new goals in the coming year.

In addition, you may find that you have a current goal that you can still check off your list before the year ends. Or, you might want to attempt a goal you abandoned this year in the new year. In some cases, it’s not too late to achieve a resolution!

Evaluate and Trim Your Expenses

Analyzing your expenses over the last year is critical, and the end of the year is a better time than ever to look at how you can cut your expenses to help you financially prepare for the new year. 

You might think this is as simple as taking at your budget. However, it really means that you should look at how you can streamline your expenses. This way, you can find more ways to have your money work for you as the new year rings in instead of being enslaved to your old spending ways.

What expenses are you choosing to throw money at but getting no value out of? Those are the ones you should look at cutting first. You could start with one and see if you miss it. Assuming you don’t, then you can take the axe to the rest of those unnecessary expenses. This isn’t to say to you should deprive yourself. Just cut things that are providing you no value.

How is Your Investing?

Since you are looking to your future, investing is generally a key component of achieving financial freedom. When I worked in the investment industry, many investors waited until the last minute to look at their investment accounts. Not only did this not help them financially prepare for the following year, but it also meant that they likely missed out on things during the current year. 

Do you have a 401k? If you do, that is the perfect place to start. See how it has been performing, and look at a possible rebalance. Not only will this help you as you financially prepare for next year, but for much longer as well.

new year's resolutions

Look at Your Use of Time

One key component to success in the new year is your time management strategies. Ultimately, the more efficient you are with your time, the more of it you have to either enjoy life or make money during it. 

Are you trying to pay off debt, or would you like to have more to invest in the stock market? If so, streamlining your time can help you earn more to either slay the debt beast or have more money to invest.

Are you trying to pay off debt, or would you like to have more to invest in the stock market? If so, streamlining your time can help you earn more to either slay the debt beast or have more money to invest.

Start by looking for ways you’re wasting time, and be open-minded about changing those problems. You’ll be surprised at how that time savings can benefit you as you financially prepare for next year.

How to Set Your New Year’s Resolutions

After you’ve taken inventory, you’ll have the information you need to set your New Year’s resolutions. These tips can guide you through the process of setting achievable goals that you can work on not just in the coming year but today!

Make a “Right Now” Resolution

Whether you are trying to lose weight, fix your budget, or learn a new skill, do not make a New Year’s resolution that is destined to fail. Instead, make a “right now” resolution.

It is simple to explain. If you are not willing to do something right now, why would you be willing to do it in two weeks? What makes January 1st more special than today?

If you see a problem, then you should attack it no matter the time of year it is. Take paying off debt, for example. If you see the need to do it now, then why wait? In fact, the time you’re wasting is actually costing you money! 

If that’s not encouragement enough to get you started, then I don’t know what is. The same can be said for saving money or starting a weight loss goal to help you be healthier. That time you’re putting it off only hurts you in the long run.

Remember that Small Lifestyle Changes Work

You need to focus on small adjustments rather than dramatic changes. For example, if you go to restaurants four days every week, do not say that you are going to stop going to restaurants entirely to save money. Instead, say that you are going to go twice per week to save some money.

As another example, if you want to lose weight, don’t think you can start a dramatic new diet on January 1st. While you might follow it for a little while, you will likely cheat at some point. You will give in, have that chocolate milkshake, and stop going to the gym all at once.

Instead, say you will stop eating candy and ice cream four days a week. If you make those small changes, you will likely succeed in the long run.

After six months, try to make additional changes so the transition is less dramatic.

new year's resolutions

Stay Focused on a Few New Year’s Resolutions

While it may sound good that you have many New Year’s resolutions you’re working on, only setting a small handful will generally help you be more successful. Having just a couple to focus on will give you the time to set quantifiable goals to reach, especially if you set yourself smaller goals that will snowball over time and lead to greater success.

When you have too many resolutions, you may stretch yourself too thin. Then, you might burn out and not achieve your goals at all.

Have a Specific Action Plan for Your New Year’s Resolutions

The resolutions some people set are too vague. For example, some of the most common and broad resolutions include:

  • Losing weight
  • Paying off debt
  • Starting to save for retirement
  • Eating healthier
  • Exercising more
  • Earning more money

These are all great goals to work towards, but they’re too vague. There are no deadlines or measurable thresholds associated with them, so there’s no motivation to begin working on them. 

A more effective goal is one that is measurable, specific, and achievable. For example, instead of saying, ‘I want to lose weight this year,’ I should say, ‘I will lose 10 pounds by February 15th.’ If I’m using January 1st as a start date, then I’ve set a deadline and a specific, measurable goal.

Beyond that, it’s critical to come up with an actionable plan to reach your goals. Without a plan, you’re much less likely to succeed.

This plan needs fit your personal situation and not someone else’s. Simply put, it needs to be something you can own and one that motivates you, convicts you, and gets you moving towards reaching it.

Check in on your progress regularly to keep yourself accountable to your set goal. Basically, you want to set SMART goals that will encourage and challenge you to actively work on them.

Ways To Ensure You Achieve Your New Year’s Resolutions

Just because you’ve set actionable and measurable resolutions doesn’t mean you are in the clear. In fact, the hard work is just starting, and studies show that only 9% of those who set New Year’s resolutions actually reach them. 

So, how can you make sure you achieve your resolutions?

Use Tools to Help You Succeed

Regardless of the goals you set, there are tools that can help you achieve them. For example, if your resolution is to travel more using rewards to stretch your travel budget, you can try AwardWallet to track your miles and hotel points without mixing in your financial accounts.

If one of your goals is to invest more consistently, Betterment makes it easy to set up a small, recurring investment to build your wealth over time. Or, if you are looking to do a better job of simply monitoring your budget, Lunch Money is worth checking out. 

You don’t need to do all of the heavy lifting on your own. Instead, use technology to your advantage.

new year's resolutions

Find Someone to Hold You Accountable

If lack of focus is a big detractor to reaching success with your New Year’s resolutions, then lack of accountability is equally so. Speaking personally, I know the goals I bring others in on have a much greater success of being reached. 

But why is this? It’s plain and simple. I don’t want to be seen as a failure. In addition, I fear being called out for not doing something I said I would. Achieving success is a great motivator, but fear of embarrassment is a strong one as well.

Find someone who will not only encourage you but also challenge you to achieve your resolutions. Tell them what you want to achieve and share the steps you’re taking to reach your goals. Then, let that person help you along the way.

You can take this a step further and keep each other accountable for your goals so each of you can see success.

Celebrate Wins Along the Way

As you work towards your New Year’s resolutions, there should be little milestones you can celebrate along the way.

For example, if you are trying to save $3,000 for an emergency fund, treat yourself to something small when you hit the $500, $1,000, and $2,000 marks. This could be as simple as seeing that new movie you’ve been wanting to watch or getting ice cream from the shop down the street.

Or, if you are trying to pay down $10,000 in debt, make yourself a special dinner when you fully pay off one credit card or get your balance due down to a certain threshold.

By celebrating your wins along the way, you will stay motivated to keep working towards your goals. Otherwise, if you just wait until you complete your entire goal, you might lose steam and eventually give up.

The Bottom Line

Setting resolutions for the new year is great, but make sure you set meaningful, measurable, achievable goals to ensure your success. 

More importantly, don’t wait to tackle your resolutions until the ball drops. If you aren’t willing to start your New Year’s resolutions today, the motivation likely isn’t there, and the odds of you succeeding are slim.

The Complete Guide to Successful New Year’s Resolutions
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