Marin Mommies presents another guest article by Marin mom and financial planner Katy Song, CFP®.
As a financial planner, I do a lot of “planning” for my clients all year long. Over the years I have learned what works and doesn’t work for making meaningful changes that stick. For example, cutting things out cold turkey doesn’t work. Long-lasting meaningful change needs to be progressive, which means you first need to learn to crawl, then walk, then run.
Whether your resolutions are financial or not, to ensure success in keeping these resolutions you need to plan ahead (before January 1st is optimal) and create steps that progress so that you build on your success over time to accomplish a larger goal. It is positive momentum from these successes that is going to help you stick with your resolutions throughout the year.
Here are some easy steps to get your progressive resolution plan in place:
- Identify the “big” goal and be specific. Is it losing 30 pounds? Saving $10,000 for a vacation? Paying down your home equity loan by $5,000? The more specific you are with the goal, the more likely you are to accomplish.
- Determine interim steps or smaller goals that are also measurable and more easily attainted. Using the examples in Step #1, your “crawling phase” could be: lose five pounds, save $1,000 by March 1 in a high yield savings account, and transfer $417 a month to repay the HELOC.
- Set-up infrastructure to ensure progress. If you want to know if you lost 5 pounds, you need a scale. If your goal is saving for a big trip, you need a high yield savings account dedicated to travel. If you want to repay your HELOC, create an electronic bill pay for it through your online banking account.
- Pre-set progress reviews so that you are accountable to yourself. For example, at the end of each month or quarter pick a date that you will take the time to assess your progress against your goal, acknowledge what is working and any obstacles you face. Give yourself 30 minutes. Put all of these appointments with yourself in your calendar now and stick to them. Through this review process, you are learning to “walk”.
- Reward progress made towards your goal. With each milestone and progressive step you successfully take, build in a small reward to help you stay the course. Perhaps it is a new article of clothing for every 10 pounds you lose, or travel magazines for every $1,000 saved towards your trip or something to spruce up your house as you pay down your debt. These rewards will refuel you so that you are ready to “run”.
By making progressive New Year’s resolutions and following these easy steps, you are giving yourself the structure you need to ensure success. Take the time now to plan at least one resolution for the next year. If you wait, the year will be gone before you know it.
Katy Song is a Certified Financial Planner practitioner and runs Katy Song Financial Planning, a fee-only firm focused on comprehensive financial planner for families with young children. You can reach Katy at firstname.lastname@example.org. She lives in Mill Valley with her husband, 4 year old daughter and 1 year old son. or through her website at www.katysong.com.