It seems as though we only just watched the ball drop in Times Square on New Year’s Eve. However, here it is, already more than three months later. That means it’s time to follow up on financial resolutions made at the beginning of the year.
“I think you have to check in with yourself periodically, whatever the goal,” says Marsha Harris, owner of Unified Wealth & Retirement Planning in Fort Wayne, Indiana. “When you see you have made progress, it’s motivating.”
Even if you haven’t made progress on your financial goals, evaluating what went wrong is an important step to making a fresh start for the remainder of 2017.
[See: 10 Foolproof Ways to Reach Your Money Goals.]
Unrealistic Goals, Poor Motivation May Lead to Failure
There are several reasons people fail at maintaining financial New Year’s resolutions. “One is not setting up a cash reserve for unforeseen expenses, and the other is setting goals they are incapable of meeting,” says Jack Cooney, principal of Bleakley Financial Group in Fairfield, New Jersey.
While making a complete financial overhaul at the start of a new year can sound appealing, it’s also overly ambitious for many people. Trying to fully fund retirement accounts, emergency funds and college savings while recalibrating spending can be overwhelming and demoralizing.
The random nature of New Year’s resolutions is another reason people often fail at them. “When you use a day of the year as your motivational technique, that’s not [something] a lot of people are able to follow through on,” says Bob Gavlak, wealth advisor of Strategic Wealth Partners in Columbus, Ohio. Once the day passes, people may lose their enthusiasm and let their resolutions slip away.
[See: 8 Financial Steps to Take After Paying Off a Debt.]
Pitfalls to Avoid This Time Around
For those committed to getting back on track, it’s crucial to avoid the traps that led to failure in the first place. “It boils down to the having the right motivation and mindset,” Gavlak says. “If you don’t truly want to make a change, it’s not going to happen.”
To sidestep a repeat of earlier failures, be sure you have selected the right resolution. Cooney suggests people think about their biggest financial fears to pinpoint what type of financial goal will be most successful. “Start by sitting down and identifying what’s keeping you up at night and what you’re going to do about it,” he says.
Then, make sure your goal is small enough that you can actually meet it. “Instead of resolving to pay off all your credit cards, resolve to pay off one specific card,” says Steve Shaw, vice president of strategic marketing, digital banking, for financial technology solutions firm Fiserv. “Plan to do that by paying an extra $50 toward the balance each month.”
Accountability is the final piece to be addressed if you want to successfully reset your resolutions. “People are always looking for excuses why not to do something,” says Dolph Janis, founder and owner of Clear Income Strategies Group in Charlotte, North Carolina. Determine how you can minimize opportunities to make those excuses. It may mean having a portion of your paycheck directly deposited into savings or finding an accountability partner who can check in periodically.
[See: 13 Money Tips for Married Couples.]
Time to Reset Your Resolutions
Now it’s time for action. “Take the most difficult thing and do that first,” Harris says. Some people may fear creating a budget. Others may dread having to consolidate accounts or complete financial documents. Whichever task feels the most overwhelming, that’s the one to tackle first, Harris says. “Then, everything you do after that feels easier.”
Technology can also help keep you on track. Apps such as Mint can make it easy to monitor spending while Acorns allows for painless investing. Meanwhile, any calendar app can be used to set up reminders to conduct periodic financial check-ups.
“You can’t choose how you’re going to die, but you can choose how you’re going to live,” Janis says. The next time you’re tempted to give up on your resolutions, ask yourself if you’re content to spend your life in your current financial situation.
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Time for a Check-In: How to Get Your Financial Resolutions Back on Track originally appeared on usnews.com
