A New Year. A New Financial You.

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Are you like the majority of people on the planet who set New Year’s Resolutions, only to jump ship by February?  I know, how negative of me!  But a confession – I am routinely one of those ship-jumpers when it comes to resolutions.

I find that creating an overarching, year-long goal that I’m going to declare over a mimosa as I’m celebrating the last day of the year (this may or may not be an accurate depiction of what is happening at this moment …) is far too lofty.  Because it is “the” resolution, we tend to think big.  I’ll lose weight!  I’ll pay off my debt!  I’ll start a new career!  It isn’t that it is a bad idea to have big hopes and dreams – quite the opposite!  Think big, but act small if you want to make those goals happen.

You can take two approaches to resolution-setting:

  • Go BIG!  Make a big, fat, juicy resolution, but accompany it with a well-laid-out game plan that breaks the big goal into smaller parts.  Perhaps you create monthly or even weekly targets that will help you stay on track to your goal.  If you are a disciplined person, this method can work well.  It is also the choice for folks that like to lay out an entire big picture plan for how you will reach your goal.  If you tend to freak out when life intervenes and your plans get derailed, perhaps this is not the approach for you.
  • Go small, but be thoughtful and hopeful. Here you decide you want to accomplish an overarching theme like desiring to change the way you oversee and manage your finances by the end of the year.  Sounds like going big, right?  Stick with me here.  If improving your financial situation is important to you, commit to choosing one micro-project each month.  If you are super ambitious or have lots of time on your hands, you could go for weekly.  Then just choose ONE micro-project for January and let ‘er rip!

By taking just a small step toward your overarching theme, the pressure is greatly reduced.  You don’t hit January 1st with a feeling of dread over how many changes you will have to implement to get that BIG THING done in your life.

Also, by choosing just one small project, you can change direction as the year progresses without feeling like you are cheating on your resolution.  This method is designed for flexibility.

I’ll give you some examples of micro-projects you can undertake:

Theme: A New Financial You

Possible projects to choose from:

  • Go paperless on all bills and accounts.
  • Construct a Net Worth Statement to see where you stand financially.
  • Commit to tracking all cash spending for a month.
  • Review all your insurance coverage and discuss its adequacy with your insurance agent.
  • Review your asset allocation in your investments and research if your choice is the right one for you.
  • Purge paper! Eliminate 80-90% of the financial papers you are holding on to.
  • Create a cool ritual to review your bank statements each month. This should involve wine or chocolate in order to make it extra special!
  • Start a new savings account for a special goal.
  • Review all your debts and create a plan to pay them off. Plan out some rewards along the way to keep your eyes on the prize.
  • Look at your spending and make a game to find ten things you can cut or reduce in order to put more money each month on your debt payoff or into your savings.
  • Create a charitable giving strategy.
  • Find five financial terms you don’t know and vow to learn what they mean and how they apply to you.
  • Read a personal finance book and take notes of strategies that might help you.

And in case you just aren’t feeling the finance theme for the new year, consider this one:

Theme: A New Physical/Mental You

Possible projects to choose from:

  • Create a tracking system and keep track of your water intake each day. Determine how much you should be drinking, and then do it!
  • Vow to move your body every day for at least five minutes. Walking from the couch to the refrigerator doesn’t count!  Make it somewhat vigorous – a brisk, but short, walk, do some yoga poses, or a few calisthenics.
  • Moisturize your skin every day.
  • Go to bed earlier and get more sleep.
  • Spend five minutes a day meditating.
  • Drink less alcohol, cut down on smoking – reduce one of your vices.
  • Consume less sugar. Choose to avoid all refined sugar for a month.
  • An apple a day!
  • Eat vegetables with every meal. Fries are not vegetables!
  • Feed your mind with juicy books and/or other education. No junk food for your brain!
  • Practice gratitude every day.
  • Find a friend who will go on this journey with you and encourage him/her every day.
  • Smile at people all day long, no matter how grumpy you feel. It’s a small gift you can give that costs you nothing.

See?  Easy, bite-sized projects.  Mix and match them, or create others that are more in alignment with where you are in your journey.

If your resolution is to see change in yourself, then by committing to one smallish action each month, I predict you will be happily surprised at the progress you make when you review your year next December 31 (with or without a mimosa – your choice!)

Your turn:  How do you handle resolutions?  Do you make them at all?  Share a story of a time you made one that you stuck with all year long.

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