Ten tips to keep your New Year’s money resolutions


Getting household finances in order is one of the most popular New Year’s resolutions. This year in particular is a priority for millions of people as the rising cost of living bites deeper.

But most likely, within weeks, these plans will be abandoned in favor of old behaviors, as financial resolutions are hard to sustain, no matter how good the intentions.

That’s why we asked a panel of money coaches and experts for tips on how to make financial resolutions that stand the test of time.

A goal makes saving easier, especially if it is positive and realistic

A goal makes saving easier, especially if it is positive and realistic

1. Don’t give up before you start

Financial resolutions are so often violated that it can be pointless to even make one. But there is a special momentum this time of year that is worth boosting – as long as it’s done the right way.

Elisabeth Costa is general manager of the Behavioral Insights Team, a consultancy firm that advises companies and governments.

She says, “There is a phenomenon called the ‘fresh start effect’. At certain current moments – such as the new year or when we move or start a job – we have a kick of motivation to make changes.’

The trick, she says, is to use this burst of motivation to commit yourself to achievable goals.

2. Don’t rely on self-motivation

Where some people get stuck is making resolutions that rely on willpower. Costa explains, “The key is to anchor the change you want in a way that doesn’t rely on constant behavior change and consistent motivation.”

So, for example, if you’re determined to save more money, you can set up a monthly standing order from your checking account to your savings account for the amount you want to save. That way it happens automatically without you having to make a decision each month to save.

You can do the same with your credit card, paying off the balance automatically each month instead of having to decide when and how much to release.

Some banks, such as Monzo, NatWest and Chase, allow you to round payments to the nearest pound – with the extra pennies deposited into your savings account. This is another good way to automate savings.

3. Save for a specific purpose

A goal makes saving easier. Ali Poulton, a head coach at Octopus MoneyCoach, says, “A popular resolution is to save more. But what is ‘more’? When do you know you’ve passed?’ She adds, “Make goals specific and with a set time in mind. So, for example, save € 1,200 at the end of the year. Now you have a goal to work towards.’

Costa adds that if you want some extra motivation, you can print out a photo of what you’re saving for and stick it on your fridge as a reminder.

4. Positive resolutions are easier to stick to

Positive goals are easier to stick to than negative ones, says Costa. For example, “I bring my lunch to work” works better than “I don’t buy new clothes.” Similarly, “I’ll set aside $10 this week” is more effective than “I won’t spend that much this week.”

Make impulse buying more difficult, for example by not saving your bank details on your favorite shopping websites

Make impulse buying more difficult, for example by not saving your bank details on your favorite shopping websites

Make impulse buying more difficult, for example by not saving your bank details on your favorite shopping websites

5. Make sure your goals are realistic

Make resolutions that you are likely to keep. We are more likely to stop trying if we have unrealistic goals.

Mike Barrow, financial coach at Claro Wellbeing, says: ‘Setting unrealistic or overly restrictive goals can negatively impact our personal well-being and hinder progress.’

He adds, “If you regularly struggle to pay for certain things or are not making progress toward a financial goal, think about how this is affecting your well-being and adjust your goals accordingly.”

6. Make your new habit part of your identity

If you are someone who tends to overspend, start telling yourself that you are a saver rather than a spender. Ali Poulton explains, ‘If you identify as a saver, you’re more likely to stick to the saving habit. Sometimes you just ask yourself ‘What would a saver do?’ can help.’

7. Make it harder to spend your money

Create friction to avoid spending mindlessly. For example, don’t store your bank details on your favorite shopping websites.

Instead, remove them so that you have to enter them to make a payment.

Also, unsubscribe from retailer newsletters so you don’t get tempted by special offers on items you don’t really need.

8. Tackle a few spending areas at once

Keeping a close track of your spending is a great way to monitor where your money is going and where you can cut back.

Rather than taking a loose approach, Barrow recommends choosing a small number of expense categories to examine at any one time.

He says, “For the next three months, for example, you could focus on tracking and reducing what you spend at the grocery store and eating out.

“Then see how much you save.”

9. Take advantage of all available help

Improving our finances can be a daunting task – so make sure you take advantage of all the help available.

For example, switch to a savings account that pays a competitive interest rate, so that you are rewarded for saving. Take advantage of tax relief and employer contributions by saving as much as possible for a company pension.

Use cashback websites like TopCashback or Quidco to get cash back when you make purchases.

10 … and don’t be hard on yourself

If you fall off the resolution wagon, don’t beat yourself up – it happens to all of us.

Poulton says, “Just be sure to pick up your habit where you left off. We sometimes let perfection be the enemy of good. But progress beats perfection every time.’

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