It’s easy to be cynical about New Year’s resolutions. After all, how many of us keep them? I didn’t achieve all of my resolutions for 2009, even though I made a rather short list to help me improve the odds of success. But, I did check a couple things off the list, and I made headway on a couple more. And that gives me encouragement to re-commit to the resolutions I didn’t keep in 2009 and try again in 2010. I’m not alone in this attitude. According to a study done by a psychology professor at the University of Scranton, John Norcross, people who make New Year’s resolutions are 10 times more likely to accomplish the changes they want than those who don’t formally resolve. So even though only one in five people manage to keep their New Year’s resolutions, those who at least make them are on the right track to eventually accomplish lasting changes.

So, go ahead. Make those grand promises to yourself to save more and pay down debt. But have a financial plan as well, performing a financial checkup and resolving to fix some of your problems. Here are some things that can help you increase the chances of actually keeping your financial New Year’s resolutions:

  1. Break it down: You’ve heard this before. Don’t just resolve to save more money. Break it down. Make it a little more specific. Look at your budget. Can you save $100 more per month? Make that your goal. Figure out what you need to do to make it happen. Open a high yield savings account. Arrange to have the money automatically deducted from your paycheck and deposited into the account. The same goes for paying down debt. Or refinancing your home (one of my financial resolutions). Look at the small steps you need to accomplish your goal, and then map out a plan.
  2. Look for support: A good support system can go a long way. If you have a life partner, make goals together, and then encourage each other. Ask for help from other friends and relatives. If you are trying to get out of debt, let your friends know and ask them to help you avoid temptation. Find others with similar goals so that you can encourage each other to make better progress.
  3. Reward yourself: Since you are breaking your financial New Year’s resolutions into small, doable steps, you can actually reward yourself. You don’t have to make the reward expensive, either. Do something small, but fun. I like to reward myself with an ice cream, or with a new book. I might also take a few extra minutes to relax or sleep in as a reward. Whatever it is, mark the occasion when you accomplish one of your small goals.
  4. Don’t get to bent out of shape about slip-ups: Don’t assume that your goal is completely scuttled if you break down one month and raid your emergency fund, or if you pull out the credit card for a grocery shopping trip. Instead, look at the circumstances that led to the lapse, and see how you can rectify the problem going forward. Don’t dwell on the mistakes; learn from them and move forward. Remember that your resolutions don’t have to be made just once a year. You can start fresh in March if you have to. The idea is to be making sustainable financial changes that will eventually become second nature to you.

The bottom line is that even though we concentrate on making financial New Year’s resolutions at this time of year, we really should be focusing on improvement throughout the year. This is really a time of reflection so that you can get an idea of what you want to do, and make a plan for better finances.

This year, I hope to refinance my home, open a Health Savings Account, and start a retirement account for my husband (we already have one for me). What are your financial New Year’s resolutions?