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Your New Years resolution ideas will probably fail.
I don’t say that to be negative. I want both of us look back on this year as a success.
But usually, only about 8% of us actually succeed with our New Year’s resolution.
Millions of us resolve each January, to make one or two changes that we believe will have an impact on our life. And then 92% of us fail at it.
But there’s two keys things that can make or break your resolution that most people don’t consider. Let’s see if you and I have a chance to be in the 8% this year.
The Two Keys That’ll Make or Break Your Resolution
Most New Years resolutions center around just 3 or 4 areas.
- Getting control of your money & reducing debt.
- Getting healthier & losing weight.
- Getting more organized in some area.
- Improving your relationships.
They’re each big, in that they’d make a big impact on our life, but none of them are complicated. We probably already know what needs to be done in each area.
So why does almost everyone fail at them?
The answer is that we are capable of big things, but we let little things trip us up. Simple things.
Key #1: Be Aware of Your Own Weaknesses, and Build in Safeguards.
We struggled with debt for years, and each year I resolved that this would be the year we’d get a handle on it. It’s easy to understand how debt puts your life on hold. When you’re locked into payments, your choices in life dwindle to almost nothing. You can’t quit your job. You can’t travel. You barely squeak by each month.
And yet, 78% of us live paycheck to paycheck.
I was making a decent salary, but I never seemed to have a dime in my pocket. A home or car repair would send me scrambling to figure out how to pay for it, because every penny was going to car payments and credit card debt.
My resolution to crush our debt failed every year, until I realized that personal finance is more personal, than finance.
It wasn’t bad luck, and the world wasn’t stacked against us.
My own simple habits were getting in the way of some big change in my life.
We’d go out almost every weekend to malls, restaurants, bars and home centers. If our friends were going to Disney, so were we. I bought three brand new mini-vans in about 8 years.
So what were my weaknesses?
One weakness was not having the spine to say, enough. I knew we were struggling. Most of our friends were two income families, but at the time we were a one income family.
Our efforts to keep up with the Jones’, and my procrastination over doing something about it was slowly bankrupting us. I had no emergency fund, and no plan to eliminate debt.
It’s normal to want to fit in, and having things in common makes it easier. But spending money based on what other people are buying, rather than what your own budget says, is a sure way to stay in paycheck to paycheck life.
What safeguards did I build in?
One of the first things I did, was to come to the realization that we needed to put blinders on and focus on our situation. And stop spending based on what we thought we should have, or what those around us were doing.
I tend to be a right-brained person, but I recognized that when it comes to money, ignoring the details was keeping me in paycheck to paycheck mode.
So I wrote a simple budget listing our income and everything we were paying out each month.
It was ugly, but it told me right away, why we kept adding to our debt. We were wildly overspending our income.
But the funny thing is, once it’s on paper, it becomes easy to see the leaks. It’s like lifting a sinking boat out of the water. Suddenly you see exactly where the water is pouring out.
With everything on paper, I was able to start targeting each expense, one by one.
I’m also a procrastinator. I’d heard for years, that having an emergency fund is critical.
But it wasn’t until I started using a budget that I understood why. A budget should be a list of your predictable expenses. Mixing in unexpected things like car repairs makes it impossible to to budget. But having a separate stash of money makes it work.
So I set up a simple emergency fund to drip small amounts of money into a separate account every few days. Even though I was living paycheck to paycheck.
This helped in several ways:
- It took something off my plate.
- It made sure that deposits happen automatically.
- Within a few months, I never had to touch my checking account or charge another emergency. Ever.
One of those leaks – a big one, was now fixed.
Getting control of your income and spending isn’t complicated. But recognizing your own weaknesses, and building in some safeguards is what’ll make this resolution work.
How about you?
Do you find yourself resolving year after year, to eliminate debt and move past paycheck to paycheck life?
Are there any patterns you can recognize, like:
- Buying clothes, dinners out, or anything else that you almost immediately regret.
- Do you plan bigger purchases, or are you more impulsive?
- Do you know how much money comes in each month, and what your expenses are?
- If you’re carrying a balance on credit cards each month, do you know exactly what it’s for, or is it a variety of things?
- Are you a procrastinator (like me) and assume things will eventually work out?
Like Dave Ramsey says, getting control of your money is only 20% knowledge, and 80% behavior. So if eliminating debt and managing money are your resolutions, consider your habits, your weaknesses, and how you spend your time.
You’d be surprised how ‘small’ habits can make or break your resolution.
- How to Budget – On Any Income
- 28 Work From Home Jobs That’ll Make You Ditch Your Commute
- 10 Things We Stopped Buying to Escape Living Paycheck to Paycheck
- 3 Easy Money Moves You Can Make Tonight
Key #2: To Get What You Want, You’ll Need to Sacrifice Something Else
The author David Allen said, “You can do anything, but not everything.”
And Oprah had kind of a twist on that. She said, “You can have it all, just not all at once”.
So whether your resolution is to get control of your money, become healthier, or organize part of your life, it’ll probably mean sacrificing something else.
But that’s not necessarily a bad thing.
When you think of the time we actually have to ourselves, it’s not much. Between work, sleep, meals and whatever chores you do, there’s not much time left to do what you want to do.
Then add in the Pareto principle, or the 80/20 rule, which says that 80% of our time is spent on things that aren’t really adding any value to our life.
It supposedly carries through in business too, where 80% of profits come from 20% of customers. And in my experience, 80% of problems seem to come from a different 20% of customers.
But here, we’ll just apply it to our own time.
- If your resolution is to exercise more, it’ll need to compete with other things to make it into that 20%. Whether that’s an hour of Facebook, or some other activity, it’ll be hard to maintain your resolution unless you decide what other time-consuming activity you can do less of.
If your resolution is to eliminate debt, you can look at it another way:
- How do you spend your time, and are those activities adding to your debt?
- Do you go out to dinner or the mall regularly? Not that dinner is a bad thing, but if your resolution is to eliminate debt this year, the way you spend your time has a big impact.
- Are there other low, or no-cost ways to spend your time?
- Or even better, can you swap time spent now for time devoted to a side hustle?
Maybe your resolution is to be more organized. Your closet is bursting with never-worn clothes, and unrelated items, bills are scattered around the house, and you only remember to do laundry the minute your head hits the pillow.
But you’re busy. Who has time to sort clothes and organize paperwork?
The thing is, that ‘busy’ isn’t necessarily productive. There’s a good chance that your ‘busy’ time is filled mostly with that 80% of things that leave you exhausted, but don’t add any value.
You already know that eliminating debt, getting healthier or more organized will add to your life.
So a key to your resolution will be to take a close look at how you spend time. Decide what lower value activity can be stopped or outsourced. Just use the criteria – is this part of the 20%, or part of the 80%?
Extra Tips to Make Your New Years Resolution Ideas Work
If you have a slip-up in the first month or so, don’t panic. It takes a month or two to develop a new habit, and an early slip-up may even strengthen your resolve. Just keep working your plan.
Sometimes it helps to have a resolution buddy, or an accountability partner. You might not feel the need right away, but a few months from now, when all you can think of is a carton of ice cream and a spoon, it may help.
If you do have a slip-up, consider the environment you were in. Maybe something or someone triggered it. For me, stress in general is a signal that tells me to find chocolate. Now.
If you find yourself repeating the same New Years resolution ideas year after year, just remember:
- Know your own weaknesses, and build safeguards for yourself.
- Consider the value of your other activities, because they’re competing for your time.
Oprah is probably right. “You can have it all, just not all at once”