Come each new year, we all make promises for brighter futures. But how many of us actually stick to them? Whether it’s a fitness plan that slumps into binge eating, or strict budget plans that collapse in a bank-breaking spending spree, a lot of us have already given up and it’s only February. So how can you steal back your dreams and find the motivation to keep going?
According to the 2013 National Savings and Debt Barometer (NSDB), Australians most value savings, holidays and eliminating debt. These are all really important steps along the road to financial freedom. One in four people list their main goal as “to be so well off that I no longer need to work”, but that’s not going to happen without some firm financial discipline. Here are five ways to help yourself stick to your plans.
1. Make your resolutions hard to break
Commit yourself to saving by setting up a direct debit to a savings account or term deposit, so as soon as your salary goes in a portion of it will be safely stashed away. This will help prevent unnecessary or unplanned expenditures.
Term Deposits generally attract higher interest, so diverting some of your savings to a term deposit can help you earn additional income while keeping your base saving intact. Only a small minority of us – less than 10 per cent – have fixed term deposits, according to the NSDB.
2. Remove temptation
Every time you buy something online, you end up on a retailer’s mailing list. Having tempting “special offers” and “daily deals” flooding your inbox won’t help your thrifty intentions. Simply unsubscribe – if you actually need a product or service later on, you can just go there manually and search for it.
Fortunately, most Aussies are sensible when it comes to luxury and designer items. According to the NSDB, most of these were listed as having a very low priority, along with taking a tourist flight to space. However, discretionary spending such as an annual overseas holiday did rate very high. Try to keep a balance – in the year you buy a new car, ditch the holiday, or take a shorter, cheaper one.
4. Don’t beat yourself up
A small lapse doesn’t mean you have to abandon your good intentions altogether. You don’t need to penalise yourself. Just move on and try to avoid the mistake, or the triggers for it, in future.
Expecting a perfect financial record sets you up for failure and can inhibit your ability to succeed. According to primary research based on personality types, having a vision of a ‘perfect future’ can affect some conservative spenders from making positive financial decisions in the here and now.
5. Reward and review
Humans thrive on winning and being rewarded. So break your plan up into small, achievable goals and give yourself (affordable) treats and prizes when you reach them. Then review your resolutions. Would a different strategy be more effective for the second half of the year/new financial year? If your circumstances change, such as job loss or a pregnancy, it may be smart to rethink.
Your financial future is a long-term strategy. It won’t be solved with a single month of good resolutions, or even ruined by a year of bad ones. Just like a fitness plan, it needs to be a holistic lifestyle change.