Ah, New Year’s — that time when we reminisce about the days of auld lang syne and vow to do better over the next 365 days. Money, too, is never far from our minds during this season of contemplation.
According to a recent study, about a third of the roughly 2,000 people who responded to the study plan to make a money resolution in 2015 — with the top three being to save more, pay off debt and spend less. While you may follow a disciplined regimen like a newly enlisted army private would, by the six-month mark, it’s very likely you could go AWOL.
Since we know it’s all too easy for enthusiasm to wane over time, we’ve come up with 12 months of money motivation — a calendar of simple to-dos that can help spark good financially fit habits, or give you an added push toward whatever goals you’ve set for yourself.
So if you feel your motivation starting to fail, check out my handy year-ahead guide. Come this time next year, you may be able to say you ended 2015 having made some sweet progress.
January: Start with a clean emotional (money) slate
What better way to begin the New Year than to forgive yourself for previous money mistakes. In other words, continuing to punish yourself for financial problems will stifle the positive attitude you need to move forward. So, knock it off now.
I suggest taking a particular money mistake — say, racking up a lot of credit card debt — and asking yourself three things: What did I learn from that mistake? What would I do differently today? And if I hadn’t made the mistake back then, would I have made it in the future — to a much greater extent?
The answers may not only help you glean lessons learned from your experience but may also give you the information needed to make wiser decisions moving forward.
February: Treat yourself to a mini reward
Love is in the air……..Consider coming up with a budget-minded indulgence that can help keep you and a loved one motivated to reach financial goals together.
“For any goal, people are most likely to continue [moving forward] when there are incentives, so try to build rewards into your plan. Perhaps it’s a date night when you reach a stated savings goal — like that dream home you want to buy this year — for three months in a row.
Or for a far-off goal like retirement, set aside $1 for something fun (perhaps a weekend getaway?) for every $10 you invest in your nest eggs.
March: Prove your job worth
If you’re still smarting from not getting the raise you were gunning for last year, do something about it by prepping for your next opportunity — NOW.
Start by asking yourself what you would have to do to satisfy your boss — and then make a list of things that would absolutely delight your manager.
Doing this early in the year can inspire you to get a jump start on boosting your performance — as well as give you months to show your boss what you’ve achieved when it comes time to negotiate.
And make sure you’ve determined how much of a salary increase you’d need to make progress on your personal financial goals, because having a dollar figure in mind can provide further motivation to make the raise request.
April: Do a little budget spring-cleaning
Who doesn’t feel better after they’ve cleaned house? Well, the same goes for your money. By clearing away a few financial dust bunnies, you might unearth some savings that can be rerouted to other goals.
One way to do this is by reviewing your costs to see which can be “postponed” to a later date, what can be “eliminated” from your budget altogether, which can be “reduced” in the future, and what you have to “keep.”
Making a cut to a recurring, nonessential expense means saving month after month, so consider putting one of your services or subscriptions on pause using a vacation mode if they offer it, and see if you miss it after a month.
May: Initiate a low-cost tradition
Use the arrival of nicer weather to devise a way to spend time with your friends that doesn’t require a pretty penny.
Think of it as a way for you and your buds to commit to being good money influences on each other — rather than spending enablers.
Research tells us that experiences — rather than stuff — give us more bang for our buck. So instead of going out to eat, opt for a picnic, or hang out at the museum on free admission night, every bit helps.
June: Review your progress
It’s easy to feel inadequate when you compare yourself to others, but a better measure of success is how you stack up against yourself. So as you come to the midyear point, remind yourself of all you’ve accomplished thus far.
So rather than feeling envious of your friend who bought a home this year, look at how much you’ve saved toward a down payment today versus six months ago or a year ago — and give yourself a pat on the back for getting closer to your goal.
July: Work a good money habit into your routine
Having a hard time making smart financial to-dos stick?
The best way to develop a new habit is to anchor it to an existing habit, like drinking your morning coffee. That’s because the non-monetary task works as a cue to remind you to get the money-related chore done. You can try this with almost any money habit you’re trying to form, whether it’s on a daily, weekly, or monthly basis.
For example, perhaps every time you pay your monthly rent, you also put $20 into a savings account. Or after you watch your favorite weekly TV show, you check your credit card transactions online to make sure you aren’t overspending. With enough repetition, your newly formed habit could become almost second nature.
August: Kick-start your end-of-year tax prep
Does gathering everything for tax time leave you feeling frenzied? Then take advantage of the lazy days of summer to save yourself some headache later.
The summer months are the boring months financially. Use the downtime to make sure you’re organized. You always want to be collecting documents that support your tax return preparation instead of waiting until the end-of-year crunch.
So whether it’s creating colored folders to categorize your tax paperwork (deductions, job-related costs, interest statements, etc.), shredding old documents you don’t need, or checking last year’s return to see what might be different this year, getting organized will help you waylay procrastination and reduce some year-end stress.
September: Reassess your student loans
Yes, we know that student loans can sometimes feel like an albatross around your neck — but every little bit you put toward that debt can help.
If you have a few spare dollars in your budget — and are on track with other goals, like emergency funds and retirement accounts — use an online calculator to see how much you’d save in the long run by upping your loan payment.
If you just put an extra $10 toward it, what would that save you in interest payments? Then try the calculation with $50. Maybe you start by paying an extra $50, and when you can’t afford to, you drop down to an extra $10. That gives you a choice, instead of saying you are either paying extra or not paying extra.
Watching a balance drop, and seeing how much you’d save in the long term, can do wonders for your morale. Debt reduction is financial freedom, and it’s more fun to work toward freedom than to pay off a debt, right?
October: Make networking a numbers-based goal
Networking events can become less intimidating if you give yourself a tangible goal to work toward, which can help “train” you to network better.
For example, before going to your next professional function, assign a minimum number of attendees to speak to before the night is over — even if it’s just a few people for five minutes each.
At subsequent events, raise that goal by two or three more people as you start to feel more comfortable approaching strangers.
Being able to have social grace, where you feel fun and playful with people, is a learned ability, like being able to jog. Every one can do it, but some people can go for 30 minutes, while some can only go for five.
November: Try going all-cash for the holidays
Does the start of holiday shopping also signal the season of credit card debt? If you don’t want to ring in the New Year with bigger balances, consider giving your plastic a rest and budget for gifts only with the cash you have on hand.
If you use cash, you’ll spend less because you feel it, moving to debit or cash can have an impact on bringing spending down. My wife and I successfully completed Christmas shopping last year WITHOUT using a credit card and with 2 young kids no less….Realizing we were starting 2015 with ZERO credit card debt feels pretty good!
Want to avoid the temptation to charge altogether? Leave the cards behind. One of the best ways to stop using a credit card is to take it out of your pocket, put it in a safe place and forget about it.
December: Learn a family money lesson
The holiday season is usually a time of taking in personal history lessons from all generations of loved ones. So why not take advantage of that by asking your fiscally smart relatives for a little financial wisdom?
Moving forward remember the advice I heard my Father say many times. Earn a quarter, spend a dime and save 15 cents. Unfortunately, most people earn a quarter, spend a quarter and then borrow another quarter at 25 percent interest. Good Luck!
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