The new year is a great opportunity to set new financial goals and make positive changes in your money management. Whether you want to save more, spend less, pay off debt or invest smarter, you need a clear and realistic plan to make it happen.

However, many people struggle to stick to their financial resolutions and end up quitting or failing. According to research, only 9% of those who make resolutions actually complete them. 1

So how can you be among the successful few who achieve their financial dreams? Here are seven strategies that can help you stay on track and reach your money goals in the new year.

1. Be realistic

One of the biggest mistakes people make when setting financial resolutions is being too ambitious. For example, if you have trouble saving money each month, it might not be realistic to aim for saving $10,000 by the end of the year.

Instead of setting yourself up for disappointment, start with achievable goals that match your current financial situation and past habits. You can always adjust your goals as you go along, but make sure they are challenging enough to motivate you without overwhelming you.

2. Be specific

Another common pitfall is being too vague about your financial goals. Saying you want to make more money or save for a vacation is not enough. You need to define exactly how much you want to earn, save or spend, and by when.

A good way to make your goals more specific is to use the SMART framework: Specific, Measurable, Achievable, Relevant and Time-bound. This helps you create a detailed road map for your financial journey, with clear milestones and deadlines.

For example, instead of saying “I want to save for my dream trip to Europe”, you could say “I will save $400 per month for one year in my high yield savings account.”

3. Make a budget

A budget is your best friend when it comes to managing your money and achieving your financial goals. A budget helps you track your income and expenses, and identify areas where you can save more or spend less.

Without a budget, you might lose sight of your financial situation and fall into bad habits like overspending or inconsistent saving. A budget can also help you decide if your goals are realistic and affordable, and prevent you from taking on more debt than you can handle.

There are many budgeting apps and tools that can help you create and stick to a budget that works for you. The key is to be honest and realistic about your income and expenses, and review your budget regularly to make adjustments as needed.

4. Consider your life changes

Your financial goals should reflect your current life circumstances and priorities. If you have experienced any major life changes, such as getting married, having a baby, buying a house or changing jobs, you might need to revise your financial plan accordingly.

For example, if you just had a baby, you might want to set up a college savings plan for your child, or reduce your retirement contributions temporarily. Or if you just bought a house, you might want to focus on paying off your mortgage faster, or saving for home improvements.

Take some time to review your financial situation and goals, and make sure they align with your life stage and needs. Don’t ignore or deny your reality, as it can lead to financial stress and regrets later on.

5. Know your habits

Your financial success depends largely on your saving and spending habits. If you want to achieve your financial resolutions, you need to be aware of your money behavior and how it affects your goals.

For example, if you tend to procrastinate or forget deadlines, you might benefit from setting up automatic transfers or payments to your savings or debt accounts. Or if you are prone to impulse buying, you might want to implement some rules or strategies to curb your spending urges.

The more you understand your money personality and habits, the better you can tailor your financial plan to suit your strengths and weaknesses. You can also use your habits to your advantage, such as rewarding yourself for reaching a financial milestone or using gamification to make saving fun.

6. Share your goals

One of the best ways to stay motivated and accountable for your financial resolutions is to share them with someone you trust. It could be a spouse, a friend, a family member or a financial advisor. Having someone who can support you, encourage you and challenge you can make a big difference in your financial journey.

You can also set joint financial goals with a partner or friend, and work together to achieve them. For example, you could save for a vacation together, or challenge each other to pay off debt faster. Having a shared vision and purpose can strengthen your relationship and your finances.

Alternatively, you can seek professional advice from a financial planner or coach, who can help you create a realistic and personalized financial plan, and guide you through the process of reaching your goals.

7. Have a financial plan

Setting financial resolutions is not enough. You need a comprehensive and long-term financial plan that covers all aspects of your money management, from budgeting and saving to investing and retirement.

A financial plan helps you define your financial goals, assess your current situation, identify gaps and opportunities, and create an action plan to achieve your desired outcomes. It also helps you prepare for unexpected events and challenges, such as emergencies, job loss or market fluctuations.

A financial plan is not a one-time thing. It is a living document that you should review and update regularly, as your life and goals change. Having a financial plan can give you peace of mind, confidence and direction for your financial future.

Conclusion

The new year is a perfect time to set new financial resolutions and make positive changes in your money management. However, achieving your financial goals requires more than just wishful thinking. You need a clear and realistic plan, a budget, a support system and a financial plan to guide you through the year.

By following these seven strategies, you can increase your chances of sticking to your financial resolutions and making your financial dreams a reality. Your future self will thank you.