How to make and keep your money resolutions

Sharon Moller

AT THE end of 2019, 59% of South Africans set out to save money in 2020, according to a survey by international research platform YouGov. Despite their best intentions, many were unable to meet their financial goals, thanks to the impact of Covid-19.

While 2021 offers us a new start, far more than a lack of discipline or even unforeseeable events, it is the way we go about setting our New Year goals that most often causes us to fall short. Most resolutions fail because they are based on a calendar date rather than on a real readiness to make a change. It might sound a bit esoteric or abstract, but the truth is that when your financial aspirations aren’t properly aligned with your life purpose, you’ll struggle to follow through with a plan, even with the best intentions.

Goals that are based on external values, such as a desire to keep up with the Joneses or perhaps to manage your money in the way your parents or others think you should, will set you up for failure.

On the other hand, when we get a grip on our intrinsic motivations – what really drives and energises us – we can develop a much more mature and useful understanding of what we want our money to do. When we make resolutions from this understanding then, whatever happens, we remain deeply committed to seeing them through.

For real results, ask the big questions.

This can be an intimidating and uncomfortable process, but it’s essential for robust financial health. And if you’re not sure where to start, a good financial planner can help you ask the right kinds of questions – and translate your answers into actionable steps. Such questions include:

● What is my life’s purpose?

● What does wealth look like to me?

● What beliefs are holding me back?

● In what ways do I sabotage myself?

There is also value in taking a family approach to this – be it with a significant other and/or your children. It is important to align your thinking as a couple, especially when it comes to money resolutions and planning for your life. If there is no alignment, it becomes difficult to stay the course.

The same goes for family and children. It’s important to have open and honest discussions about your dreams and how your money supports your goals for the future, get them to plan with you and decide on actions together.

A key part of our success and long-lasting impact is to celebrate the small wins. We need to get to the essential, underlying reasons for saving, investing or getting out of debt. That way, we can work towards our money goals – and be prepared for whatever life throws at us.

Sharon Moller is a financial planning coach at Old Mutual.