Salvaging Your Financial New Year's Resolutions
February Financial Refresh:
What to Do When You’re New Years Resolutions Have Waned
Unfortunately, it’s true. Fifty five percent of us will have broken financial resolutions only three months into the year. That’s why February is the perfect time to put the breaks on any financial bad habits that are sneaking out of control, and re-focus on how we can still get the most out of our 2020 financial resolutions.
We’ll think of where things could already be going off the rails (or, not yet acted on!) in two categories—spending and saving. Here are a few ideas for each to get you back on track before we hit that three month mark where we’ve completely let them slide!
Spending
Use a Budget App: It is so incredibly simple but this one financial lifestyle hack can make all the difference in managing your money mindfully. There are so many options today, and places like Mint take truly two minutes to set up and connect with your primary account. Of course, these are at their best when linked across your holistic financial picture. But we’ll start with baby steps. If getting control of spending is on your radar, simply start here and make yourself five broad categories—something like essentials, fun money, saving, debt, and investing. These of course will change for you, and you might want to break it down further but if you’re just trying to get started don’t overcomplicate it. Set up an app to track your spending in these categories and sign up for alerts to keep you aware of all your habits.
Analyze One Week of Purchases: Heck, start with even a few days. Really, our financial habits are apparent in the small choices we make in our every day lives so it doesn’t take long to identify patterns and places for improvement. Realizing that in just a single week you’ve thrown down your debit card on a bunch of discretionary purchases can make you more able to analyze the triggers that are driving that behavior.
Check Your Food Habits: This is where I get off track quickly. Grocery budgets get busted fast in NYC, and take out or delivery almost always seems like the easier option. Spend a few days eating only out of your home (either cooking, or bringing food to work) and “faux-order” the few meals you would have been inclined to buy instead, making note of how much money you saved. At the end of the week, dump that into a savings account and applaud your discipline.
Saving
Just Automate It: Seriously, this is almost the only realistic way to get into saving. Paying yourself first and making it a thoughtless act on pay day is essential to turning saving into a habit. If you’re already doing a monthly deposit to a savings account , consider automating your deposits and breaking it up into two payments and inching it just a bit higher. You won’t feel quite such a pinch if it’s spread out further, and interest will accrue faster than if you were doing it just once!
Revisit Your Goal, Pick a Smaller One: If you set a monster of a new year’s resolution goal around savings, it might be time to revisit it and think about how you could break it down into something more achievable in the near term. Sometimes with big goals, we set them so out of reach and don’t break it into smaller action steps that keep us motivated over the time it takes to see results. If you wanted to get to $10k in a savings account this year, start tinier. Tell yourself to just get to $500 before the end of the next month, and start being agressive in reaching that goal. You’ll be really motivated to keep going once you see the smaller progress marks hit relatively painlessly.
