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Setting financial goals for the New Year

Calling all New Year’s Resolution-ers: it’s time for change.

The first month of the year is usually when we dust off the holiday cookie crumbs, take off our stretchy eating pants and muster up the motivation to make positive adjustments to areas in our lives like our health or career.

So with all of this added drive and momentum, why not begin the New Year with focus and clarity about what you’d like to achieve in your financial life as well? Here are some tangible tips for starting off 2018 on the right foot financially.

Change your way of thinking about savings.

A good first step is to switch from a spend-then-save method to a save-then-spend system. So instead of using your paycheque to buy all the things you want and saving what may (or may not) be left over, flip the pattern and set aside your savings before spending the remaining funds.

You can take a number of steps to succeed in your savings resolution.

  • Budget. A spending plan will do wonders for meeting your savings goals because it will help curb any excessive or unnecessary spending. apps can be an added boost with budgeting and spending tracking as well. Or if you like the satisfaction of crunching the numbers yourself, check out our budgeting calculator.
  • Set goals. Be clear about how much you’d like to save and set up a timeline for it. They should be measurable and reasonable to achieve – for example, saving up $3,000 for that trip to Disneyland by July (if the kids behave, of course).
  • Automate your savings. This is when the ‘set-it-and-forget-it’ rule comes into play: set up pre-authorized payments of a regular pre-determined amount from your chequing to your savings Time this to go out with each paycheque, before you begin aimlessly spending.

Get the ball rolling on your investment goals.

Make an appointment to meet with a financial planner. If you’re new to investing or just want a second opinion, a financial planner can be a great resource for getting you on the right track to your goals. Once you have a date and time booked to discuss your investment goals, you’ve taken that important first step. If you’re ready to get started right away, great. If not, consider your meeting as an opportunity to explore your options and ask questions.

Come prepared. Sit down for a few minutes before your appointment to think about your investment goals and needs, and review your budget. If you receive any retirement or RRSP benefits from your employer that you’d like to supplement, review this as well so your financial planner can get the big picture.

Make SMART decisions by setting SMART goals.

View your New Year’s financial resolutions as financial goals that you’ve set for the coming year. Like all goals, you can increase your chance of success by basing them on the SMART acronym:

S – Be specific. Instead of resolving to just ‘do better’, you might want to pick an area to work on, like your savings.

M – Be measurable. A goal to ‘be a better saver in 2018’ is hard to track, which means you can’t evaluate your progress. As we previously mentioned, you might want to set a goal amount and a timeline for reaching your goal.

A – Be achievable. While a challenging goal is okay, your resolution should be achievable or else your frustration will make you quit.

R – Be relevant. Make sure your goal is appropriate for your situation and needs. For example, if you have debt from a high-interest credit card, paying this off will be a more relevant goal than savings.

T – Be timely. You’re more likely to succeed with a timed goal, like saving three months of living expenses by July 2018.

Other hacks to succeed.

In addition to setting SMART goals, you’ll increase your chances of success in the following ways.

Collaboration. Involve your friends and family in the process. If you’re leaning on the support of others, you’ll be less likely to give up if you all agree to keep each other accountable.

Celebration. Choose a few days in the year to give yourself a special treat for sticking to your resolution. Maybe it’s a nice dinner or a new crock pot.

Use an expert. Involving a financial planner through regular meetings to discuss your financial goals and progress can also be a big help (psst… we can help with that).

Take advantage of these financial goal setting tips and make 2018 your best year yet. And hey, if you need a little assistance, we’re here to help.