30 Jan 2024
If breaking New Year’s resolutions is as much a tradition as the act of making them, you’re not alone – nearly 45% of New Year’s resolutions don’t even make it past the first month.1
So why not try something different this year?
The main reason resolutions fail is because they’re often formed without a strategy. A strategy has clear directions, timelines and consideration of resources needed, which is why they are much more likely to be acted upon.
Now is a great time to think about what you want to achieve over the coming months and develop a road map.
Reflect on your goals
What is it you want to achieve this year? Knowing this, not only strengthens your vision, but your chance at success becomes much more likely.
Many of us share similar goals. According to the website Envision Experience, the most common self-improvement goals people strive for are to improve their health and fitness, find their life purpose, acquire more skills for success, strengthen relationships, challenge themselves and improve their self-esteem and positivity.2
While these goals may resonate for you, you need to set goals that are meaningful to you, not simply reflect what others want to change in their lives. Simply writing down “earn more money” or “lose weight” will make your goals more like resolutions, grandiose statements that have little direction and no intent.
Have a clear goal. Instead of saying “earn more money” why not try “financial goals for 2024”, make a list then define each one.
Think of the ‘why’
Before creating your plan, think about why you want to achieve these goals. Your 'why' will be the reason you get up early in the morning for the gym or cut back on takeaway three nights a week. 'Why' will be the core motivation keeping you focused as you work towards achieving your goals.
Creating your strategy
Once you have a clear idea of what you’d like to achieve and more importantly why, it’s time to develop your strategy to succeeding. Start by transforming your new year’s goals into SMART goals – Specific, Measurable, Assignable, Realistic and Time-related. SMART goals were introduced in 1981 via a paper by George T. Doran in the Management Review journal and has been a popular feature for goal setting be it small or life changing.3
The SMART criteria will help you define and strengthen your goals and form a framework for your strategy, recognising the resources you need and any potential challenges.
Say for instance you want to go on a holiday. By thinking ‘Specifically’, you narrow down the focus to committing to saving money. To make the goal ‘Measurable’, you decide you want to save $5k by mid-year. The person ‘Assignable’ is you. By being ‘Realistic’, you plan for what results can be realistically achieved – how much money can you set aside each week to achieve $5k in savings by June. The ‘Time’-related aspect of the goal is the date you have set yourself to achieve this (in this example, mid-year).
Once you’re off and running, review your progress regularly and reassess your initial strategy, so that you continue working towards success.
Managing multiple goals
As with resolutions, we can overextend ourselves with our goals. This doesn’t mean you have to pick just one goal but be realistic about how many you can manage. Someone who knows all about goals is Warren Buffett, who recommends writing a list of goals and narrowing it down to five.4 His theory is that all other goals are in fact distractions that will prevent you from achieving what matters to you most.
If you’re striving towards more than one goal, it’s a good idea to stagger them. You don’t want to plan to train for a marathon, take on that big project at work and agree to volunteer for an event only to create competing pressures on your resources and time required to achieve them. Consider how your goals fit together or if they take time away from the other, and plan accordingly.
All strategies benefit from having a mentor or a coach to keep you focussed and accountable to the goals you have set for yourself. We can work with you to help you achieve your version of success this year with a clear financial plan for your future.
As always, if you have any questions or your personal circumstances have changed please do not hesitate to contact your financial adviser.
General Advice Warning - Any advice included in this article has been prepared without taking into account your objectives, financial situation or needs. Before acting on the advice, you should consider whether it’s appropriate to you, in light of your objectives, financial situation or needs.
