New Years a time of change.

While there is no right time for change or new beginnings; the time around the New Year is as good as any, many people are thinking about resolutions and changes and that line of thinking is pervasive in our society. To top that off Christmas is done and the craziness around the holidays are hopefully finished; so it’s probably a better time than most because you don’t have as many additional factors causing your plans to go awry.

It’s a new calendar year and you can use that time to assess where things went right or wrong in the past year (or more) and to pick up the pieces where they stand. The key to this is to not be judgemental and simple to learn from the past rights and wrongs. Instead of beating yourself up because you overspent and in debt, see what caused you to get there, what habits were causing you to stay in debt and what spending habits need to change.

If you use the famous 80/20 rule you get 80% of your results from 20% of the actions. To put that into perspective you can make a significant change by only changing 20% of your actions which is high impact and can make a lasting change, while not being as daunting.

I’m taking the time around the new year to assess were we stand financially, knowing that there are some challenges with me being out of work. Knowing where stand financially and then figuring out what our goals are for the New Year is key. Something that is measurable and will likely make the most impact for the least amount of effort.

What I’m referring to is the big impact items, so if you like to get your Starbucks every morning this likely your biggest point of impact. To continue on that thread if you get a coffee every day and cutting it out would be both a challenge and only save 2$/day then it’s not as effective as trimming your grocery budget down by $25 or even $50/week or getting rid of cable which can be $100/month and paying down debt.

Goal setting is next; if your goal is to set aside $5000 in savings then you might feel daunted any try finding money everywhere starting with the small amounts, for example that cup of coffee at Starbucks. Breaking the task down will make it more manageable and achievable. Using our example of $5000 translates to $416/month or $96/week which is feasible for many people and can be done fairly simply (Note if your budget is tight be sure to set yourself realistic goals).

Finding and tackling a few more impactful items will achieve your goals quicker and with much less headache. It’s challenging to find the few things that will make the most impact but if you do it you’ll find it easier to tackle the changes and set realistic and achievable goals.

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