It’s that time of year again. Time to reflect on the past year and think about what we want life to look like moving forward into 2015.
According to a survey by Morningstar, 49% of those polled, stated health and fitness was the number one area for improvement this year (again).
A close second was managing money better at 40%. So if you thought you were all alone in wanting to fix this area of your life, you are not.
So how do you keep your resolution on track? I would suggest ditching the resolution, which is merely an emotional whim spouted out on a reflective holiday, and go with a more thought out, realistic goal. Your goals should be obtainable (realistic) and have specific deadlines.
For instance, let’s go with the #1 resolution. A common statement would be; “I am going to lose 25 pounds this year”. While a great concept, it is pretty vague. So you will rush out full steam, starve yourself of everything tasty, fight the overly crowded January gym, and give up 2-4 weeks later, frustrated that you have not achieved that perfect body.
What if you tried this instead:
Losing 25 pounds is great, but usually a lofty dream. But what if you only had to lose 1 pound every two weeks?
That sounds pretty easy right? With 52 weeks in a year, and one pound lost every two weeks, you can ring in 2016 at your GOAL of 25 pounds lost. Yes that would mean changing your diet and or exercise for an entire year. So? I recommend doing your own research, but the amount of change necessary to lose 2 pounds a month, is definitely not as drastic as trying to lose all 25 pounds in one month.
Okay, this is a blog about money and I used a really long example about losing weight. Sorry about that. However, this can be used in your finances too!
Let’s say your “resolution” is to get out of debt. If you have $5-10,000 in debt this can be accomplished, but if you are in the $25-50,000 debt range, getting out of that much debt in a year might be overwhelming and unreasonable.
Instead, set a GOAL – an obtainable, realistic goal with a specific deadline.
Suppose your debt looks like this:
JC Penney Credit Card – $400
Visa Credit Card – $2600
Car Loan – $12,000
Student Loan – $22,000
That totals $37,000 and is a lot to take on in one night of day dreaming.
So set a goal to pay off the smallest debt first (so you free up your income quickly) and decide to knock out the JC Penny card in two months. Let’s make it more specific – paid off by February 28th.
Then you can take the money you were paying on that debt and add it to what you are paying on your Visa card and set a date of say August 1st to pay it off. It may seem small in comparison to the total of $37,000, but you have knocked out $3,000 in debt in six months and you are enjoying the satisfaction of seeing your clearly defined goals reached. Now you set your sites on paying off the car.
I won’t speculate on your specific situation, this is merely an example, but there are steps you can take to make real changes in your personal finances.
Take the time to make goals, knock them out and celebrate the turn of the next year with real results and a renewed vision for 2016.
Don’t get discouraged if you struggle with setting money goals. If winning with money were easy, everyone would be rich. It is hard work, that is worth it in the end.
If you would like to visit with me concerning your finances, I am an extension of Dave Ramsey’s Coaching team and would love to see you become wealthy with his time tested process. Don’t let fear or shame hold you back from achieving your goals. Where you are today, does not have to determine your future.
My name is Tim Parady and I am 36 years old. I was born in Connecticut, raised in Virginia, had a brief layover in Kansas which led me to Texas where I met my wife and best friend. We just celebrated 145years of marriage.
I have the best job in the world, which is to improve peoples lives. I teach people how to win in all areas of there money, which affects all areas of their lives.
78% of Americans live paycheck to paycheck, with no money in the bank and little knowledge of how to invest for their retirement. You can have a different future. You can win with money and I can show you how.
I am an independent Dave Ramsey Financial Coach,and Insurance Agent at Alkali Insurance and I am here to serve you. My goal is to provide knowledge and tools to change your life. To schedule an appointment to address your financial needs and goals, email me at firstname.lastname@example.org