NEW YORK (MainStreet) — Many of us made a lot of resolutions in ringing in the new year, including financial resolutions. Plans on how to keep them weren’t as common.
“People who make resolutions often do not reach their goals because they are attempting to make overwhelming changes,” says Shannon Cassidy, author of the newly released The Five Degree Principle: How Small Changes Lead to Big Results.
We talked with some financial experts about the most common financial goals people make and how to keep them:
Creating a budget: Possibly the most common financial goal people make is to create a budget. “Unfortunately, most people get excited for a week or month, after which they go back to their old habits,” says Liran Hirschkorn, an independent insurance broker. Hirschkorn says the best way to keep this resolution is to put pen to paper and get your budget in writing. “Don't put it off, or on some list. Do it now,” he says.
Paying off credit card debt: How many years has it been now that you’ve resolved to paying off your credit cards? Kelley Long, CPA and a spokeswoman-member for of the National CPA Financial Literacy Commission, says many people fail at this goal mainly because they don’t stop using the cards. To help you keep your goal, Long recommends putting it on a calendar such as the one at whatsthecost.com, which has a calculator on it that tells you your debt-free date.
Saving more money: If you haven’t been able to keep this resolution in the past, it could be you need a little help. Daryl Dagit, financial adviser with Savant Capital Management, says many people need to set up an automatic savings plan, even if it is just $5 per week taken from their check, to help get started.
Giving to charity: As with savings, a lot of people break this resolution because it falls last on the list after paying monthly expenses, paying down debt and even using funds for discretionary spending. “The way to make this resolution stick is to add a line item into the budget which includes a large charitable amount,” says Douglas Goldstein, a certified financial planner. People will typically keep the resolution if it is a budgeted item, he says.