It’s always nice to start afresh for a new year. That’s why we make promises to ourselves to change a habit or start one, in order to become a better version of ourselves.
But New Year’s resolutions are notoriously tricky – studies show only roughly 10% of people keep up.
For the rest of us, we’re still trying to convince ourselves that this year is really, really, really going to be different.
And it actually could be, with the help of these simple tips:
Accept that things will not be perfect
Anyone can slip up. But when you do, bear in mind that missing the mark on the odd day won’t derail your plan for the year.
In fact, as long as the days you kept to your plan outnumber those where you didn’t, it’s fair to say you’re one step closer to your improved self.
Focus on what you’re doing differently
Letting go is not easy. Less so is trying new things.
So instead of reminding yourself every day not to eat that bag of potato chips, start the day planning how you’re going to fit in that gym session or which new salad to try.
Use present-tense, and specify
Instead of saying “I will save every month”, say “I put aside $250 every time my salary comes in”.
It frames the target as an established practice and is a subtle way of tricking your brain against weaselling out.
Tell someone about your plans
By sharing your targets with someone — a supportive person who knows what keeps you ticking when you are in need of motivation — it’s less likely you’ll lapse unnoticed.
Better yet, if you have a buddy who shares the same resolution as you, all the better as you can spur each other on.
If there’s something to look forward to at checkpoints towards a long-term goal, you’ll more likely have more motivation to press on.
For instance, if you had aimed to save more money, treat yourself to indulgences like a nice meal, a new dress, or tech gizmo when you cross certain thresholds.
These tips are not only effective, they are easy to remember and put into practice.
If you’ve drawn up a list of resolutions, you can incorporate these to make the journey to a better you more positive and enjoyable. If you haven’t — or did not include personal finance resolutions — maybe these suggestions could come in handy.
TipSet resolutions that are fun so that you're not constantly reminded that you're trying to change a habit.
1. Save for your retirement
If you haven’t started planning for your retirement, start now. Yes, this resolution is not specific, but it’s intentional.
Not scare-mongering but with each passing year, you are one year closer to retirement.
It may be daunting to think of how much you’ll need, but while you work that out, start saving, even if it’s just a little.
2. Don’t spend any $5 note you get
By the end of the year, you’ll probably have hundreds, and all from a little game you play. The money could pay your insurance premium.
You could take your family out for a meal. Or you could splash it on a vacation.
Point is, this simple personal challenge is a painless way to etch into your brain the virtue — and pleasures — of saving.
3. Top up your CPF every January
No matter how much you deposit into your CPF, know that you’re getting a better interest rate (currently, you get up to 5%) than with any savings account.
You can deposit up to $7,000 a year into your own account, so doing it in January earns you more in interest.
The additional perk: You get tax relief on your top-up amount.
4. Make yourself spend nothing for two weeks
It’s an effective and efficient way to reset your attitudes. You’ll think about your consumption habits. You’ll learn about yourself. And you’ll save some money.
Once you get the hang of it, maybe you can do it every quarter just as some would occasionally go on a detox diet.
5. Generate an alternative stream of income
Again, the amount is not the nub of the experiment. Instead, it’s to learn about how you can grow your income.
It may be from a small side business, or investing in the stock market.
6. Use your pay raise to reach your financial goals
Your pay raise is actually worth more than you think, since your expenses are unlikely to grow that much year on year.
Automate a transfer of your raise amount out of your salary crediting account on each month’s payday into a savings account, and work out how best to exploit the additional money.
You may be able to pay off an extra month’s mortgage for the year, or clear your debt, or use it for investing.
7. Learn about one asset class every three months
Let’s face it, many of us say we don’t know enough to start investing. And that will never change if you don’t start learning.
Be realistic, though. If you haven’t started reading up on investing, you should give yourself ample time to digest the information.