As the clock strikes midnight to mark New Year’s Day, this is the time that we often begin to reflect on what we have achieved over the course of the last 12 months. Part of this reflection can also make us focus our attention on specific aspects of our life we may feel that we have neglected up until this point.
As such, roughly 41%* of us find ourselves devising a New Year resolutions list often with the aim of restoring a sense of balance in our life – this can entail a shifting of our priorities through the redistribution of time, effort and sometimes money.
According to TwitterAU, here were the most tweeted New Year resolutions in 2017 by Australians:
Other common New Year resolutions tend to focus on enjoying life to the fullest, getting organised, reducing debt and spending less to save more.
Unfortunately, if you read our article, “Does a New Year Resolution set you up to fail?”, you will find that 25% of us ‘throw in the towel’ within the first week of making our resolutions. This percentage steadily increases with the passage of time (i.e. 29% in two weeks, 36% in one month and 54% in six months) – and, when all things are said and done, 88% of New Year resolutions fail. This may help to explain why our resolutions tend to be the same year after year.
As such, when establishing or reviewing your existing New Year resolutions list, it’s important to:
- Carefully consider your goals; are they realistic in their obtainment and do they hold specific relevance and meaning to you? By considering this first, you may find that you start off on the right foot and subsequently increase your chance of adhering to the path that you set for yourself in the achievement of your goals. This can be referred to as the contemplation stage.
- Put in place an appropriate plan (e.g. how are you going to get to where you want to be, such as the steps required and an appropriate support network) and then start making your goals a reality. A plan gives you a sense of direction and an appropriate network of people can provide you with support along the way, and with that, you are able to move from thinking about doing something to actually doing it. This can be referred to as the action stage.
- Periodically review your progress. Keeping track of how you are progressing towards your goals will not only give you an indication of what you have achieved to-date, but also allow you to gain a greater understanding of your current position in relation to your goals – this can often be done after important milestones have been reached. This can be referred to as the review stage.
- In a similar vein to above, proactively reaffirm your goals in the face of setbacks. Life often has a habit of getting in the way of our best intentions. In these situations, it’s important to appropriately address any setbacks that may occur, reach out to your support network, make any adjustments where required, and then refocus your attention to the goals at hand. This can be referred to as the reaffirm stage.
- Lastly, once you have reached your goals, it’s important to maintain, and in some instances build upon, what you have achieved. After all the hard work, it can sometimes be easy to fall back into old habits, which may see you ending up right back at square one. Like the milestones that lead to your goals, think of the completion of your goals as another stepping-stone to something else. This can be referred to as the completion stage.
In addition, to the list of resolutions that you may have already set, give thought to any areas of your personal finances that may also require some attention. Here are a few personal finance-related resolutions you may wish to consider:
- Talk to your partner about your existing financial situation, as well as the goals and objectives you would like to work towards now and into the future.
- Set aside some time, every so often, to educate your children on personal finance basics e.g. budgeting, spending and saving.
- Familiarise yourself with your Money Personality and increase your financial literacy with the resources on our Financial Knowledge Centre.
- Organise your finance-related paperwork in a filing system and actively engage with any statements you may receive e.g. investment and superannuation statements.
- Revisit your budget plan and track your day-to-day spending habits.
- Establish an emergency buffer.
- Get a handle on your debt repayments e.g. home loan, investment loan, personal loan, car loan and credit card debt.
- Make sure you have a suitable Plan B in place to insure against unexpected events that may occur in the future e.g. general and personal insurances.
- Familiarise yourself with the concept of ‘Future self-continuity’ and be proactive in planning for retirement. Read our article, “Running the retirement planning race”.
- Track down any lost superannuation and consider the consolidation of multiple superannuation accounts.
- Make sure your estate planning affairs are in order e.g. will, powers of attorney, guardianship, superannuation death benefit nomination, and potentially your cyber assets.
Focusing on areas that need attention and making the required changes in your life can sometimes be difficult, especially when things have become engrained in your daily habits; however, the results can be truly amazing when you look back at where you started and what you needed to do to achieve the goals that you set for yourself.
When it comes to areas of your personal finances, remember that you do not have to tackle these on your own. If you need help, please do not hesitate to book a time to have a chat with us.
* J. Norcross., M. Mrykalo., and M. Blagys. (2002). Auld Lang Syne: Success predictors, change processes, and self-reported outcomes of New Year's resolvers and nonresolvers. Journal of Clinical Psychology, 58(4), pp397-405