Many of us choose New Year’s resolutions around being smarter with money. However, studies show that 20% of Americans keep to their resolutions past February and only 8% make it all year. We’ve compiled three practical tips to help ensure you stay committed to your resolutions for a strong financial future and build self-discipline.
- Define your resolution. Make your resolution realistic and specific. For example, making a resolution to pay off debt or save money can leave a lot open for interpretation and is not specific enough to keep you motivated. However, to pay off a $2500 credit card by March or save $3000 in your emergency fund by Julyis a way to define your resolution with the potential for success.
- Create your action plan. If you keep doing what you’ve always done, you’ll get what you’ve always gotten. Let the achievement of this year’s financial resolution be different. For example, if your resolution is to save $3000 for your emergency fund by July, you could start by creating and implementing a budget and then tracking your spending. By creating this action plan you are better able to measure how much money you can save each month.
- Discover the reasons for your resolution. This is essential to staying disciplined. This is because your resolution will often include changing a behavior or taking a new action. When times get tough or an unexpected event occurs, it’s easy to revert to old habits. If the resolution of saving $3000 is to feel secure to be able to handle unexpected events, then this reasoning will help you to stay motivated. Discovering the “why” behind your resolution is a key to stay disciplined on your action plan.
These three tips provide a practical guide to achieve your resolutions and be part of the 20% of Americans who keep them. Your successes this year and subsequent years will help propel you towards accomplishing your long-term financial plan. Why not get started today?
Information in this material is for general information only and not intended as investment, tax or legal advice. Please consult the appropriate professionals for specific information regarding your individual situation prior to making any financial decision.
Email me your questions at financial.freedom@lpl.com or call 541-574-6464. You can also post your question on our Facebook page: https://www.facebook.com/FinancialFreedomWealthManagementGroup
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