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Only 9% of people meet their New Year’s financial resolutions, here’s how you can succeed!
Key points
- Of the 40% that set New Year’s resolutions, only 9% actually meet them.
- Committing to a system as opposed to focusing on a goal will help you get the results you want over time.
- Results have little to do with the goals you set but more about the systems to achieve the goals.
As 2021 came to a close, many of us looked toward starting off on the right foot for 2022. About 40% of Americans make New Year’s resolutions. Unfortunately, only 9% of people achieve their New Year’s goals. Want to be the 9% that succeeds? Even if you weren’t able to keep your resolutions, it isn’t too late. Here are three ways to maintain your 2022 financial resolutions and get back on track.
1. Learn the difference between goals and systems
A system sets the framework and is the means to achieve your goals. Systems-based thinking is not about hitting a certain number, but sticking to a process where you can continually build on your progress. Systems help you focus on what you can control. Goals on the other hand are good for setting direction, keeping you motivated, and keeping you focused.
One of the top financial resolutions people make every year is to save more. Saving $1 million is the goal. Creating a budget to save 20% of your income is the system. Losing weight is the goal, eating healthier and exercising more is the system.
2. Commit to the system, not the goal
Why is this important? If success is tied to a certain goal, it increases stress, especially if you don’t reach your goals. But if you focus on the system, you can learn to enjoy the current moment while improving at the same time. Once you achieve a goal, the motivation often stops. Committing to a system instead will help you continue moving forward whether you meet your goal.
Another popular resolution is to improve one’s credit score. Let’s say you hit your goal of achieving a credit score of 720. Congratulations! However, if you miss a payment the following month, your credit score will take a huge hit. Meeting the goal isn’t enough.
You need to commit to following a system of paying your bills on time, paying off debt, and limiting the number of credit score inquiries. This way, not only will you meet the goal, but surpass it. You cannot get long-term results by just setting goals. You get long-term results by setting and sticking to a system.
3. Let go the need for immediate results
If people investing today expect a large return tomorrow, they will most likely be disappointed. But if they stick to a system of disciplined investing, they will be more likely to get the results they want over time. Consistent systems help people avoid emotional decisions if goals aren’t met immediately or even after they meet them.
In the end, systems help you be consistent. It helps you seek feedback so you know what to adjust to make the process better. If the right system is there, goals aren’t the end, but now the means to building the right system.
There is a reason only 9% meet their financial resolutions. By understanding the difference between a goal and a system, committing to an effective system to meet your resolutions, and focusing on the long-term, you too can become part of the 9%.
by David Chang, ChFC®, CLU® | Published on April 4, 2022