One New Year resolution that is frequently made and just as frequently broken is to spend wisely from the start of a brand new year. People want to use it as a fresh start to let go of bad spending habits in order to become better equipped and wise financially. Fortunately this is one of the better resolutions that can be made; unfortunately, this is the one resolution that is difficult to stick to initially, and that is mostly when this resolution is broken. In the first couple of months, this scenario can be easily changed and financial goals can be achieved following these three simple steps.
- Have A Definitive Goal: In order to achieve your goal, your goal should be a well defined milestone rather than a vague idea. When you have a goal as such you can chart out a clear path to get there. A definitive goal should have the following three characteristics:
- Well Specified: Your goal should be well specified in terms of projected income, savings, expenses, and investments. Without this, a lot of resolutions are as vague as “do better financially this year”, which is not going to help at all. Have a clear cut goal and an estimated budget to follow it up.
- Be Realistic: This very important aspect when setting your goal. Each of us have our own set boundaries and limitations. So, when you are making a financial plan make sure you stay within those limits to get a realistic and workable plan. It would be near impossible to achieve unrealistic goals, especially financially. You may never get to your desired goal and may even dent your determination a little. You are not going to get to a million dollars as soon as you start saving, so make sure the goal you set is realistic.
- Tracking: The goal you set also requires you to chart a definitive path. Ensure that there are enough reference points in this path so that you can keep an easy track of yourself. It is important to know where you stand, how far you have come and to what degree, if any, you have deviated.
2. Planning For Success: It is prudent and important to have a contingency plan but it is equally important that your main plan is that for success. Try to keep up with your monthly targets and try to catch up if you see yourself lagging. If you have made a plan to save a certain amount every month then make sure you do it.
3. Stick to Your Plan: When you are done with the first two steps then it is time to get the show on road. This is a bit difficult than the first two steps, but once you get a rhythm going this is going to be just as easy. You will need a little dose of will power at the beginning but think of the long term benefits you would reap.
These three points are just a frame of reference and a simplified explanation. Achieving financial goals is not easy but it sure is not difficult either.