Financial Resolutions Reboot: 4 Ways to Help You Get Back on Track at the Six-Month Mark

Financial Resolutions Reboot: 4 Ways to Help You Get Back on Track at the Six-Month Mark

Think back to where you were on January 1, 2015.

In between putting away the last of your holiday decorations and scrolling through Facebook photos of friends toasting the New Year, there’s a good chance you were setting a money resolution.

Whether you wanted to spend less, increase your nest egg contributions, or save up to buy a car, you probably remember how great it felt to embark on a fresh, new goal.

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Unfortunately, if you’re like most Americans, that motivation may have fizzled by now. According to a 2002 University of Scranton study, only 46% of resolutioners were successful at the six-month mark.

“In the beginning people get a rush of excitement because they haven’t gone to task and done the work yet,” says psychologist Maggie Baker, Ph.D., author of “Crazy About Money.” “But actually sticking to the program can get old fast.”

In other words, when the reality of passing on evenings out with friends or forgoing a new summer wardrobe in order to make progress on your money goals starts to wear on you, you might question whether it’s really worth the effort.

Sound like someone you know?

To help you get back on track, we’re exploring four simple strategies that address the most common reasons we tend to throw in the towel on financial resolutions, so that you can jump-start your progress today—and reach the finish line before we flip the calendar to 2016.

RELATED: 6 Ways to Kick-start More Mindful Money Decisions

Resolution Reboot #1: Play It SMART

Committing to a financial resolution is a lot like agreeing to host Thanksgiving dinner—it's a lot easier said than done.

While you might have grand visions of cooking a gourmet meal of sage-brined turkey and truffle-infused mashed potatoes for 12, without ample planning, proper tools and a calculated timeline, you’ll crash and burn.

Ready to revamp your resolutions road map by baking in the same principles of success?

Introducing the “SMART” system—a step-by-step achievement approach that stands for Specific, Measurable, Attainable, Relevant and Time-Bound.

Let’s start with step one—specific. “You can have a resolution that sounds great in theory, but if it’s too vague, you’ll have trouble executing,” says Eleanor Blayney, CFP®, a consumer advocate for the CFP Board. “You need to take the time to think through the fine points—the who, what, where and when of your plan.”

For example, if your resolution was to save more, drill down to a specific figure you'll save each week moving forward. Then walk through exactly how you’ll trim your budget to meet that amount, and where you might stash the funds, such as in a money market account or your Roth IRA.

The next step is to make your resolution measurable. Let’s say you want to save up for a 20% down payment on a house by the end of the year. Figure out how much you still need to sock away in order to afford it, and make sure that sum is reasonable, factoring in your income and expenses. (If it's not, you may need to adjust your timeline to something more realistic—more on that in a minute.)

“If you make the same resolution year after year, you already have a legacy of failure—so it’s time to readjust.”

Once you have that down, do the math to determine how much you’ll need to save from each paycheck to get there. “Knowing the numbers is really important because it gives you a reality check to make sure your goal is feasible,” Blayney says.

Now for the “attainable” part of the equation. In order to be victorious, your aim needs to be realistic, striking the right balance between challenging and workable.

“If your goal is out of the ballpark, you’re setting yourself up for disappointment,” Blayney says. “And if you make the same resolution year after year, then you already have a legacy of failure—so it’s time to readjust.”

One common problem with resolutions that you may keep rehashing is that they may lack relevance—the fourth component of SMART goals. “So be very thoughtful about how you articulate your intentions,” Blayney says. “In order to stay motivated, it’s essential to emphasize the positive effects and why it’s an important goal for your life.”

The goal in this step is to envision the end point. For example, simply resolving to be debt-free isn't as powerful as saying you want to pay off your credit cards so you're more likely to qualify for a mortgage on a new home your family will love.

Finally, address the timing aspect. Without a doable schedule for reaching key milestones leading up to your resolution deadline, it can be far too tempting to put off doing anything until November or December.

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Resolution Reboot #2: Take the Pulse on Your Progress

Although demographic factors—such as gender and age—don't usually play a role in resolution accomplishment rates, certain people may inherently be more likely to triumph.

That's the finding that clinical psychologist John C. Norcross uncovered while conducting research for the Scranton study on resolutioners' success rates we mentioned earlier.

What kind of people, you ask? Self-efficacious ones—or those who believe in their ability to accomplish a particular task.

“High-achieving personality types are more successful because they have a track record of excelling under difficult conditions,” Baker explains. “They aren’t self-defeating.”

People with low self-efficacy, on the other hand, tend to give up sooner because they’re not convinced they have the wherewithal to stick with it. If they encounter a single setback—like giving into an impulse buy—they’re likely to internalize it as an utter failure and bow out altogether.

The good news is that self-efficacy isn’t a personality trait that’s set in stone. In fact, Baker says all you need to do for a little boost of tenacity is think back on past successes—and give yourself a pat on the back.

“Once a week look at the progress you made, and give yourself permission to feel happy and proud. This will renew your confidence and motivation,” she explains. “And if you do slip up, have self-compassion. Instead of beating yourself up, stay neutral and look at what happened with a sense of curiosity.”

Simply remind yourself that goal achievement is a process—with ups and downs—and that you’ll likely have plenty of other opportunities for success in 2015.

RELATED: How to Make a Financial Comeback: 3 Real-Life Tales of Resilience

Resolution Reboot #3: Conserve—and Properly Channel—Your Willpower

Over the past several years, researchers have been conducting fascinating studies on the science of willpower—how to strengthen your resolve, what depletes it, and how to harness the determination needed to achieve your goals.

One of the most interesting—and counterintuitive—findings, according to the American Psychological Association? The less you engage willpower, the more of it you'll have.

Research from Florida State University finds that willpower is fueled by glucose in the bloodstream, and we have only a limited store of it to draw upon throughout the day. So the more glucose you burn through, the lower your reserves drop—along with your willpower.

That's why you should ideally focus on one big-picture resolution at a time, Baker says. “Since willpower is a finite resource," she explains, "tackling multiple goals that require conscious effort will leave you drained and unable to fulfill any of them.”

Translation: Your uber-ambitious aims to cancel out your student loans, beef up your emergency fund from one month's worth of take-home pay to six, and max out your 401(k) all by year's end can be a recipe for burnout.

As a result you may be more vulnerable to cave when faced with real temptation—like deciding whether or not to reallocate the money you've managed to stockpile for an all-inclusive summer cruise.

So if your number-one goal is to save $3,000 by December 31, channel your willpower toward that singular effort—and put secondary resolutions on the back burner until setting aside $250 from each paycheck to build up that $3,000 is a no-brainer.

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With an accountability partner in place, not only will you be motivated by another person keeping tabs on you, but you'll have reinforcement when the going gets tough.

Resolution Reboot #4: Buddy Up

Bill Withers had it right when he famously sang, "We all need somebody to lean on"—especially when it comes to nailing a resolution.

With an accountability partner in place, not only will you most likely be motivated by the fact that there's another person keeping tabs on you, but you should have reinforcement when the going gets tough.

“So explain [to someone in your inner circle] that you’ve set out to accomplish X goal, and that you think it might be helpful if you could give them a short, five-minute call once a week to update them on how it’s going,” Baker says. “Just make sure they know that you won’t hold them responsible for whether or not you succeed.”

Can’t think of anyone to be your designated drill sergeant? Sharing posts about your intentions and progress on Facebook, Instagram or Twitter may give you a similar sense of accountability.

Or you can try a program like stickK, a goal-setting platform that leverages the power of accountability and incentives to help users accomplish their resolutions. On the site, you’re asked to articulate your goal, sign a personal commitment contract, name someone as a “referee” to monitor your progress, and choose a penalty if you don’t prevail, such as donating to a cause you don’t believe in.

The proof is in the pudding: stickK reports that users are up to three times as likely to achieve their goal if they follow this methodology.

Talk about some odds that really could be in your favor.

RELATED: 3 People, 3 Big-Picture Money Goals: A Behavior Change Expert Explains How to Stay Motivated

LearnVest Planning Services is a registered investment adviser and subsidiary of LearnVest, Inc., that provides financial plans for its clients. Information shown is for illustrative purposes only and is not intended as investment, legal or tax planning advice. Please consult a financial adviser, attorney or tax specialist for advice specific to your financial situation. Unless specifically identified as such, the individuals interviewed or quoted in this piece are neither clients, employees nor affiliates of LearnVest Planning Services, and the views expressed are their own. LearnVest Planning Services and any third parties listed, linked to or otherwise appearing in this message are separate and unaffiliated and are not responsible for each other’s products, services or policies.

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