New Year’s resolutions are fundamentally flawed.
The idea of doing something for an entire year is both daunting, unpractical and frankly, a little boring.
So let’s try something new in 2017. We’re going to take a single resolution, getting your finances in order, and break it up into 12 easy-to-accomplish, month-long goals.
By setting up a series of manageable tasks, you’ll be able to make real month-by-month progress while staying motivated and mindful of the big picture. Because really, what good is starting something if you can’t finish it?
12 Month Guide To Accomplishing Your Financial Goals
January: Create Long-Term & Short-Term Financial Objectives
The beginning of the year is the perfect time start accomplishing your financial goals. Start to take stock of your financial past, present and future. Start by looking back at 2016. Was last year a success from a financial goals standpoint? Next, talk to your partner about where you want to be financially both today and tomorrow. Make sure your short-term plans are nested directly within your long-term view and both are leading to the same endpoint.
You should consider creating SMART goals for your finances. Your goals should be specific, measurable, achievable, realistic, and time-based (SMART). You could make a goal this year to finally get out of debt or build a fully-funded emergency fund. Or, you could save for a down payment on a house.
A short-term goal could be paying for all of your Christmas gifts next year with cash. If that’s actually one of your short-term goals, now is the time to start. Look at how much you spent in 2016 on Christmas gifts. Set a budget now of what you’ll spend in December and start saving each month for that goal.
Short-Term Goal — Pay for Christmas 2017 With Cash!
- Specific. Set a specific dollar amount to save. The average American spends about $460 on gifts for family members.
- Measurable. Look at what you spent in 2016 and use that figure to budget this year.
- Achievable. If your budget is $600, you need to save $50 each paycheck.
- Realistic. Yes, you can get it done in a year if you start now.
- Time-based. You have 12 months to save for next Christmas.
February: Increase That Emergency Fund
It’s important to have at least three to six months of living expenses saved for the unexpected. Maybe even more if you have a large family to provide for. An emergency fund helps keep you out of debt or prevents you from increasing debt in the event of something unforeseen like the loss of a job or an unexpected home or car repair.
It’s usually best for an emergency fund to be liquid, which means it’s easily accessible from your regular old savings account. An emergency fund shouldn’t be used for any investing. And the more your automate your savings, the greater your odds of success.