5 Tips to Make Your 2022 Financial Resolutions Stick

If your 2021 finances threw you for a loop—or was a continuation of the challenges you faced in 2020—a financial resolution might be on your list as one of the ways to improve your life in 2022.

More than two-thirds of Americans are considering a financial New Year’s resolution according to Fidelity Investments’ Annual Resolutions Study. What are the most popular financial resolutions people are considering? Save more money, pay down debt and spend less.

But simply making a resolution doesn’t mean you’ll keep it. Less than half of people who make resolutions are still on track to meet their goals by June. If you want to be in the group that succeeds, you should learn how to overcome challenges that can make it harder to achieve financial goals. Here’s 5 strategies to help keep your 2022 financial resolutions:

1) Recognize That Achieving Financial Goals Can Be Tricky
As much as you’d like to think that improving your finances depends on simple math, it’s more complex than just the dollars and cents: It’s emotional. “Most money behaviors are emotionally dictated,” says Cecile Lyons, a psychologist specializing in financial psychology. “In a split second, our brains make a decision and rationalize it.

Because you may not feel completely comfortable talking about your finances with others, you might hesitate to tell people about your resolution or enlist a friend to help you stay accountable as you progress. And, If you’re dealing with reduced income or health concerns, you may not want to set a resolution at all. Instead, you may want to focus on other actions like applying for pandemic financial aid to help with rental assistance, or reviewing your student loan repayment plan.

2.) Identify and Understand Your Motivation
We make resolutions at the top of the new year because it feels like a natural time for change, says Saundra Davis, financial coach and founder of Sage Financial Solutions. But because It’s January 2022, it isn’t a good enough reason to stick with your plans to make a financial change. Instead, you need to consider what the action will do to benefit your life down the road. Maybe it will give you peace of mind that you can pay all your bills each month. Maybe it will allow you to see opportunities to save more.

3.) Aim for Small Improvements
If your resolution is too big, it’ll be hard to see your progress. If your resolution is “I want to be financially stable by the end of 2022,” it’s a broad goal that doesn’t break down what you need to do to achieve this. You don’t have any markers to signal when you’ve accomplished something, or identify anything that has changed. “You need to self-examine so you can be specific to your resolution,” Lyons said. Breaking bigger goals into smaller resolutions can help make your progress more attainable by setting a SMART goal (Specific, Measurable, Attainable, Relevant, and Time-Bound) that require you to set parameters around the behavior you’re trying to change.

4.) Ditch Your “All or Nothing” Mindset
Once the clock struck midnight it might of felt like the pressure was on to succeed right away. “We hope that inspiration will become motivation, and that motivation will become action,” Davis says. And then, we expect ourselves to perform that action perfectly every single time. “That’s a big part of the challenge, this notion of all or nothing. We’ve got to get it right, or we’re a failure.” Davis recommends thinking about the general path you want to take, instead of getting hung up on your daily success rate.

5.) Anticipate Failure, Acknowledge Your Progress
If you truly mess up, Davis says to pick up right where you left off—don’t start over from scratch. Instead of getting upset at yourself, give yourself space to learn a lesson about yourself and your habits. For example, check out this common New Year’s resolution: Cutting back on coffee shop visits. If you decide to give up drive-thru coffee each morning, but found yourself pulling up to that window four times last week, it’s time to rethink the reason you ended up there, Lyons says. Is it because your morning routine is too rushed to allow you to make coffee before you leave the house? Or, is it because you’re convinced the only way to kick start your long, tiring day is to get that caffeine jolt from the pros? Taking time to reflect on what got in the way of your success can help you determine ways to improve your efforts.

At NIHFCU, a GreenPath Financial Wellness counselor can’t give you advice on your morning coffee routine, but they can share some “tried and true” advice on how to start building your New Years Financial Resolutions. They can help you gain a better understanding of your financial picture and what steps to take to improve financial wellness.