Think back to January: What money resolutions did you decide to go gangbusters on? Maybe this was the year you decided you'd get down to a $0 credit card balance. Or maybe you’re determined to boost your retirement savings come hell or high water.
Guess what? By June you’ll have a nearly 50/50 chance of following through on those goals, according to research from the University of Scranton. That's because we all lose motivation over time: The behavior-change scientists found that at the six-month mark, 40% to 46% of folks were still keeping up with their resolutions.
Of course, you're better off than most already: You have an Action Program in place, and you know which goals you're gunning for. But if you could use a little motivational push, don't worry—that means you're only human.
To help you keep making progress, we asked a psychologist and one of our own LearnVest Planners to look at five of the most common financial resolutions and pinpoint the biggest mental hurdle associated with each. Then they explained ways to try to sidestep it. Here's to your momentum!
1. Saving More Money
Deep in your gut you know you need to save. Looking, superficially, at your bank balance, you know you need to save, because you never know when a financial emergency might strike. Or you simply need to jump-start saving for a big goal you already have: a new car, a home or big trip. Even when you have the best of intentions, why can it get so difficult to stay disciplined?
The Mental Hurdle: You might be too focused on the short term and not enough on the long term, says Fran Walfish, Psy.D., a psychotherapist in Beverly Hills. For example, you might think that saving, say, $50 a month is insignificant and therefore not worth stashing away, so you spend it on a fancy dinner instead. (The thinking: It's just $50 bucks!) "The truth is, even a small amount builds up if you keep doing it," says Walfish. You could stay more motivated if you focus on your end goal: The $600 you’ll have at the end of the year, as opposed to the $50 you're waffling about this week.
Help Yourself Stay on Track: One of the keys to continuous saving is taking human deliberation out of the equation and automating as much as you can, says LearnVest Planning Services CFP® David Blaylock. You may already have completed your challenges to automate savings transfers, but think about what else you could be putting on autopilot. For example, could you open another online savings account, name it for your big goal and automate your deduction of $50 to that? "When money is out of sight, it's out of mind. If you can keep the money out of your hands, that's helpful," says Blaylock.
Also make sure you’re keeping tabs on your priority goals in your Money Center. Watching how those trickle-in transfers grow over time can help keep you motivated.
2. Paying Off Student Loans
Student loans can haunt people for many years. Not surprising, considering students these days graduate with nearly $30,000 in debt. Of course it's not easy to chip away at a sum like that, but many people put it off indefinitely, not just for lack of funds, but for lack of wanting to look at their debt. Thing is, the longer you wait to pay it off, the bigger your payback amount—in the form of accrued interest—gets. So how can we avoid our avoidance?
The Mental Hurdle: Just getting started. This is where your Action Program comes in. If you've already decided with your Planner that paying down debt is one of your top priorities, you've already got a plan in place (and we'll tell you exactly which next steps you can take, below). Remember: Paying off loans isn't going to get easier if you wait until tomorrow.
The other thing is, you may have some psychological resistance. How people feel about paying down debt is often tied to how they feel about being pursued by an authority figure, says Walfish. "I think that's a big factor that separates those who pay off their loans faster.” Try to separate how you feel about that debt from the best practices for getting rid of it, because that's the quickest way to get out from under.
Help Yourself Stay on Track: The plan you received from your dedicated Planner includes a financial calendar that shows the monthly amounts that can help you reach your debt repayment goals. “That amount has been optimized to help make sure that we're considering not only things like interest rates, but also emotional factors—how does that debt feel? Which debt do we want to attack the most quickly? That's part of the plan-building process. The physical manifestation is the calendar,” Blaylock says. And remember that the payment also takes into consideration whether you're still working toward basic financial security goals, including emergency savings, retirement and paying down credit card debt.
That's why it's important to check your financial calendar at least once every two weeks to review what payments have been made and what payments are coming, he suggests. If you’re already taking a daily Money Minute, then this may not be an issue. If you’re not, you can set a digital reminder with a free tool like Google Calendar so you don't forget to check your progress.
3. Paying Down Credit Card Debt
Credit card debt often “feels” different from other types of debt because it can rack up fast and cause a fair amount of anxiety. In fact, one poll shows that people feel more embarrassed to admit to their credit card debt than their age or weight! It can feel difficult to stay motivated to keep chipping away at it when your balances never seem to shrink.
The Mental Hurdle: Credit card debt isn’t fun to think about, so you can’t blame yourself for wanting to put it off. But what that leads to is procrastination because you don’t want to deal with an unpleasant situation. Walfish says the mental block against paying down credit card debt is akin to cramming a task in before its deadline, like pulling an all-nighter for an exam or renewing your driver’s license on the last possible day.
In addition, you might be adding to the credit card debt through impulsive rationalization—in other words, you tell yourself that you never go on vacation, so charging this one last-minute getaway won’t hurt anyone. “You’ll say, 'I’ll just do it this time.' You’re delaying the unpleasant and replacing it with some momentary good vibe.”
Help Yourself Stay on Track: Remember that there's more of an urgency to paying off credit card debt, as opposed to, say, student loan debt, because of the higher interest rate you’re being charged. "It's unforgiving and needs attention right away," says Blaylock. “Think of it as paying off a high-interest loan.”
Also, remember that not paying down your debt or charging too much can negatively impact your credit score, which can influence your future ability to take out a mortgage, buy a car or even get a job. If you’re not already, check the free site CreditKarma once a month for an estimate of your credit score, and go through AnnualCreditReport.com once a year so you can check for any inaccuracies in your full credit report.
And as with student loans, consider sticking to the number that's in your financial calendar. That's because if you make a huge payment one month, you may throw yourself off budget in other areas—which could lead to charging items when you've run out of cash for the month. This could throw you into what's called a "revolving debt cycle." To avoid getting stuck, consider putting your cards in the freezer to avoid using them, and unlink your card number from any online retailers where it might be saved.
RELATED: Credit Scores 101
4. Spending Less
You know how it goes—you go to Target for one thing and come home with $100 worth of stuff. Or you don’t realize until the end of the month that you’re dropping $100 on workweek lunches. How can you be a more mindful "everyday" spender?
The Mental Hurdle: It comes back to impulsive rationalization, Walfish says. A lot of times we turn to "retail therapy" and buy things to feel better about ourselves in the moment. You might think, "I had a bad day," so you purchase something that you don't really need for the temporary pick-me-up. And this impulsive urge you may feel actually comes down to brain chemistry: "The dopamine rush is part of it," says Walfish.
Help Yourself Stay on Track: As a premium member, you’re already one step ahead because you’ve set up a budget with the help of your Planner that helps guide your spending. Now you just need a sense of how well you’re sticking to it. “For most people, it’s not that spending less is so much of a challenge; it’s just that they don’t have the information they need to make the best decisions,” Blaylock says.
One easy way to do it? Use the "trends" feature in your inbox to get a big picture of how much you’re spending by month, by year, or for the entire time you’ve been a premium member. Then you can scroll down for a spending breakdown by category for the month. This helps you determine exactly how much money you're actually spending on, say, groceries, versus how much you should be spending based on your preset budget amount.
Also make a note to keep tabs on your unfoldered expenses. If you’re not regularly categorizing those transactions, you may not realize that there are expenses you’re not accounting for. This is where taking your daily Money Minute will have a huge impact.
5. Sticking to a Budget
Setting up a budget and learning to live by it takes time and energy, and for some folks that may not be so fun. How can you go from feeling reigned in to realizing you’re the one in control?
The Mental Hurdle: "You have to be honest with yourself about what you really and truly want" from the budget you’ve set up, Walfish says. “Some people really want to live a happy, indulgent and comfortable life. Others want to be able to spend on par with what others spend in their age range. Take a truthful look within, and don’t judge and compare. Own your decisions and your choices.”
This means you shouldn’t feel guilty about budgeting for flexible expenses that help you enjoy life—just make sure it’s not at the expense of other goals you may have for yourself. “Take a moment to think your money decisions through. I think that taking a moment gives you an opportunity to really evaluate if it's the right thing,” she says.
Help Yourself Stay on Track: You've likely already worked with your Planner to determine how much you're devoting to your fixed expenses (things like rent or gym fees that don't vary from month to month) as well as your flexible expenses (variable costs like your groceries and personal shopping). And you're probably also keeping tabs on your Money Center transactions and budget tracking on a regular basis to stay motivated. But beyond that, Blaylock suggests telling family members and friends about your goals so that they can support you and hold you accountable.
“The biggest thing I often hear people say is that so much of their environment—friends and families—can contribute negatively or positively to their ability to stick to a budget,” Blaylock says. "Otherwise, it's like trying to diet when everyone around you is ordering dessert. You want them on board so they can help. Craft your support system."
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 people interviewed 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 in this message are separate and unaffiliated and are not responsible for each other’s products, services or policies.