COMMITTING TO YOUR MONEY...NOT JUST A NEW YEARS RESOLUTION
By: Jean-Luc Tahou, MBA, CFP

It is that time of the year again where we are at the dawn of a new year, an entire 365 days of possibilities. We typically make hastened and bold resolutions that we invariably break before the end of the month. Our resolutions range from saving more, to shopping less, beginning to invest or even tithe more. I am challenging each and every one of the BCF readers to do themselves a favor and try a different approach.

Indeed the problem with resolutions is that they are uttered with only the coming year in mind. I will ------(fill in the blanks) with my money in 2010. We put pressure on ourselves to achieve such lofty goals within a restrictive period of time. The failure to keep those resolutions is usually the result of an awakening, a realization that we may have signed up for too much at once. Faced with the idea that our resolutions are too daunting, we give up before we invest too much of ourselves into them. After all, what’s the point of beginning something if we are convinced that we are going to fail? We come up with all types of excuses to justify our giving up: I am too busy, I will resume tomorrow, the issue is not that serious, etc. I will have to agree that resolutions are hard to keep, so with that in mind, I will encourage you NOT to make a resolution for this year.

I am suggesting a different and stress-free approach. In terms of your finances for this year, visualize a new person that you’d like to be. No resolution-like pressure, just a vision in your mind, a beautiful you with your finances in order. This new approach has to be grounded in the knowledge that you deserve to take care of yourself and no one BUT yourself can do a better job at it. It then no longer is about doing what you think is the RIGHT thing to do, but more so about doing RIGHT by yourself. This new paradigm is not concerned with a schedule, no longer focused on proving others wrong, no longer worrying about the guilt of our bad financial decisions. It is more about loving yourselves enough to undertake the actions that will take care of you and your loved ones.

If resolutions are a sprint race, this new commitment to your financial well being is an endurance marathon. Whatever it is that you are trying to improve, you can succeed by coming up with realistic goals and taking incremental steps to achieve them over time. I am referring to a lifestyle change where present-time gratification is somewhat curtailed and procrastination is eliminated. The time is now to wipe the slate clean and begin to live anew. By gradually incorporating change in your life, you will progressively build on those small successes to strive for bigger and better things in your life. For example if your objective is to save more:

• Start by opening the account first. Consider this a victory
• Begin putting something minimal, say $10 a week into it
• Once you see your balance accumulating, you'll feel motivated to put a little more into it
• Don't be mad at yourself if you wipe it out for some reason. Bunk down and start over. Don't be too hard on yourself, but be conscious of your mistake and focus on holding off for longer this time around
• When you reach a milestone ($500 or $1000), reward yourself
• Set a new milestone and repeat the process

The point is that small successes build up our confidence and encourage us to do better. What you do not realize is that we are creatures of habit, and this process will get you into the habit of doing something.

Resolutions are good, but a commitment is even better. We all have things we need to improve when it comes to our financial affairs. Only we can unlock the hidden potential we have inside so we can make it happen. Setting up small habits that will stand the test of time is a start. What better time than at the beginning of a new year to get started? Ready. Set. Go....