How well are you doing at keeping your New Year’s resolutions? If you’re having trouble sticking to them, don’t be alarmed.
Over the past five years, 43% of those who set a finance-related New Year’s resolution failed to achieve it or to sustain their success, according to a telephone survey conducted on behalf of the American Institute of CPAs by Harris Interactive.
The survey found that the top financial goals for 2013 are paying down or eliminating credit card debt, increasing emergency savings, or planning for retirement, demonstrating the importance that people place on getting their financial houses in order.
If you have broken some of your financial resolutions, or are worried you will, the Connecticut Society of CPAs offers these practical tips.
Get back on track
If it’s hard to stick to your original plan for an entire year, remember that you can always get back on track. Let’s say you decided that you were going to pay down some outstanding debt this year but stopped or never got started, despite your best intentions.
Don’t give up! There’s still a whole year ahead of you, and plenty of time to work toward your goal.
Set time limits
One good idea is to cut the year into smaller pieces. If you resolve now to start saving more in 2013, it’s easy to put it off until later in the year. The problem is that many people who do this often look up one day and realize that the year has passed and they haven’t taken the steps needed to reach their goal. That’s why it’s smart to start out with a short time-frame-three or six months, for example-and pledge to meet your goal within that period.
And if saving money is your top resolution, keep in mind that you can have your bank do it for you by having money deposited directly from your checking account into a savings account each week.
Get a reality check
Some people give up on their resolutions because they are built on high expectations that are difficult to achieve. For example, if minimizing your debt is one of your resolutions, accept the fact that it will take time. Determine the minimum that you think you can realistically pay off in the coming year-say 5% or 10% of your outstanding balances — and dedicate yourself to doing it.
If you get there sooner than you expected, resolve to pay off another 5% or 10%. If debt reduction isn’t working at all, then decide that you will not add any new debt to your balances in 2013. By setting reasonable objectives, you’re more likely to succeed.
Cut back to basics
In the same vein, if you have a long list of resolutions, it may be tough to find the time or commitment to make them all work. Focus instead on one or two positive steps you’d like to take and devote all your energy to them.
If your goals include pumping up your retirement fund as well as saving for a vacation house, it may be best to postpone trying to finance that house until you have your retirement account in order. Choose a few goals that represent your highest priorities and you may have more energy and incentive to take the necessary steps to achieve them.
You can always add new goals later once you’ve attained the ones that are most important.
The Connecticut Society of Certified Public Accountants supplies this column. For more information, visit www.cscpa.org