We're barely a week into the New Year, but I'll bet plenty of folks are already struggling with the resolutions they felt so excited about back in December. In fact, many people have given up already! According to some studies, 25% of resolutions fail after just a week. After 6 months, less than half of resolutions are still active.
A common theme in my reading on this topic is that most resolutions fail because they aren't specific or meaningful enough. On today's show, we discuss why 2022 should be the year you stop making resolutions and start making action plans to hit your top goals -- especially financial ones.
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1. Automate your progress.
As we've discussed in several of our blogs and podcasts, our government has begun to encourage folks to take more ownership over their retirement planning. New legislation proposes that employers be required to auto enroll new employees in retirement programs, because people are less likely to unenroll than they are to sign up on their own.
An expression I often use to convey a similar idea is, "Pay yourself first." Instead of waiting until the end of the month to see what money is left over from your discretionary spending, prioritize your contributions to retirement, investment, and emergency savings with automatic deductions from your bank account.
You can also apply the same strategy to your 2022 financial goals. Instead of putting a big lump charge on your credit card for a trip you'd like to take, start automatically setting a little money aside every month in a dedicated savings account. This could be a good habit to talk to a child or grandchild about too if they're starting to plan for college or hoping to buy a new car once they've earned their driver's license.
2. Start small to achieve something big.
Paying yourself first also exemplifies another key goal-setting strategy: building towards a big goal step by step rather than trying to accomplish too much all at once. This is why a resolution like "I'm going to be healthier" almost always fails. No one can just "be healthier" all of a sudden. What you can do is set daily and weekly exercise goals that will build, run by run, crunch by crunch, to a healthier you.
I've talked about the physical transformation I've gone through recently, and setting manageable short-term goals was a big reason for my success. At this next stage of the journey, I've had to recalibrate. Weight fluctuations are normal for everyone, but rather than say, "I don't want to gain any weight back," which is unrealistic, my trainer has helped me work out a fitness plan that will keep my fluctuations in the 10-pound range. Following the plan will lead to minimal weight swings, which will keep me healthy.
3. Find some leverage.
And if I ever feel like I might slip up, I can always look at the picture that kickstarted my new commitment to fitness: a photo of myself from a vacation a few years ago that really splashed water on my face. I didn't like how I looked, and that picture gave me the leverage I needed to make a change.
One great form of leverage is surrounding yourself with people who have similar goals. I'm now active in my gym's online community, where we all post pictures of our progress. I don't want to be the guy who lost all the weight and then put it back on. A little peer pressure doesn’t hurt!
To leverage your own goals, you might find a running buddy who's going to bang on your front door on those mornings when your bed is just too comfy. Or you and your spouse might commit to a joint savings goal where you both cut back on some personal expenses so that you can go on a second honeymoon this summer.
4. Know who you are.
Accountability, planning, and simplicity are all vital building blocks of a good 2022 goal. But if you don't set a goal that's really important to you, those blocks are still going to fall apart.
When you're thinking about what you want to accomplish this year, don't jump on some social media trend or try to keep up with the Joneses. Instead, sit down with a blank piece of paper, and ask yourself, "Who am I? What are my values? What do I know to be true and how can I live those truths better?"
Answering these questions can lead to changes that will be so much more impactful than an arbitrary weight loss goal or a reading challenge. Deep down, no one wants to lose 10 pounds just to lose 10 pounds. What you really want is to feel better and have more energy so that you can run through the park with your grandkids. You don't want to save money so that you can have more money. You want to save so that when retirement comes, you have the financial base you need to live your best possible life.
I sincerely hope that working towards the goals you've set is going to make 2022 your best year yet. Call up my team at Keen Wealth if you'd like to discuss how our planning process can help you make meaningful progress this year and all the way through to your retirement.
Bill Keen is a CHARTERED RETIREMENT PLANNING COUNSELOR℠ and independent financial advisor with more than 25 years of industry experience. As the founder and CEO of Keen Wealth Advisors, a registered investment advisory firm, he specializes in providing personalized retirement planning designed to help people thrive before and during their retirement years. With a passion for educating others, Bill regularly blogs about retirement planning, hosts the podcast Keen on Retirement, and has contributed to U.S. News and World Report, Reuters, Wall Street Journal’s Market Watch, Yahoo Finance, and other publications. Based in Overland Park, Kansas, Bill and his team work with clients throughout the greater Kansas City area and across the nation. To learn more, connect with him on LinkedIn or visit www.keenwealthadvisors.com.
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