Five steps to achieving your New Year's money resolutions

"New year, new goals, new me" has a positive and hopeful ring to it. But setting new goals is easy; the tricky part is staying on track. 

A study by Richard Wiseman, a psychology professor at the University of Hertfordshire in the UK, found only 12 per cent of people manage to achieve their New Year's resolutions.

When it comes to setting money goals, the incremental hurdle is that many people find money stressful and overwhelming.

The National Financial Capability Survey 2021 found that 17 per cent of Australians were not very confident or not confident at all about their ability to hit a financial goal.

To avoid feeling like you're swimming against the tide, here are five steps to setting and achieving your financial goals this year.

1. Understand your money mindset

When I run financial literacy workshops, there's an exercise I use to help people understand the factors influencing their financial capability and confidence.

Ask yourself:

• Is money a source of stress, or joy?
• Is my attitude around money positive or negative, abundant or scarce?
• What is the underlying problem that I need to unlearn?

Identifying the fears, thoughts and feelings associated with our money goals gets us a step closer to facing them.

Addressing triggers that might make us more likely to quit allows us to embed countermeasures to face any triggering situations that may lower our resolve.

It can also help us move from a limiting or negative money mindset to a positive or growth money mindset.

2. Use your 'why' to set smart goals

Start by asking yourself why you want to save/invest/reduce spend. The more you visualise the outcome, the more you are likely to achieve it.

Having goals which are approach-oriented and SMART (specific, measurable, attainable, realistic and time-bound) are generally more successful than avoidance-oriented goals like "stop spending money on expensive brunches".

Adding in your why makes for a more positively geared goal: "I will swap a weekly $40 Sunday brunch for a walk-and-talk in a different park each time so I can build an emergency fund."

Once you've nailed the specifics, stick your goal on the fridge, by your desk, on the bathroom mirror so you have visual cues supporting you in framing, and, occasionally revisiting, your goal in an achievable way.

3. The power of 'yet' and 'get'

The next step is to reframe each of our limiting and negative thoughts by adding two words — "yet" and "get" — to our toolkit.

This approach, which American psychologist Carol Dweck calls The Power of Yet, can help you work towards your goals by embracing hope and an enthusiasm for learning.

Adding "yet" to "I don’t know how to manage money" can be the first step to increasing your financial confidence.

"I need to call the bank to refinance the mortgage" adds to the never-ending to-do list, something nobody wakes up with excitement to do on a Monday morning.

Instead, "I get to call the bank to refinance the mortgage for our house so we can put the savings towards a family trip this year" makes it something to look forward to, a privilege to be grateful for and excited about.

4. Find an accountability buddy

If your money goal is to get out of credit card debt this year, sharing that target honestly with someone you trust — siblings, a significant other or friends— can help create the support network to encourage you to achieve your goals.

Periodical check-ins with your accountability buddies are more likely to help you stay on track and avoid losing face.

A few years ago, I tested this out, during Global Money Week, by sharing one money tip a day, with my close friends.

Being open and vulnerable about my money goals encouraged everyone else to reciprocate in being each other's accountability buddies not just for finances, but for career, health and fitness as well.

5. Money is an enabler, not a goal in itself

All goals are generally intertwined. It's easier to stick to a money goal when we remember than money is a tool for our wellbeing and lifestyle.

Remember, progress is better than perfect

The key to gaining confidence with managing your money and nailing your financial goals is to:

• Acknowledge your journey to date;
• Face your fears and embrace what makes you uncomfortable;
• Focus on continuous learning even when it doesn't quite work out exactly as planned; and
• Have some fun along the way!

Keep in mind that if you do not feel confident with money yet you're in the same boat as two-thirds of the world's population. The good news is you get to work on it this year.

Today is a great day to start. Good luck!

Disclaimer: This is general information only. You should consider obtaining independent professional advice in relation to your particular circumstances

Ketvi Roopnarain is an award-winning chartered accountant and the founder of OuiMoney, a social enterprise focused on financial education. Together with MoneyGirl, she gets to help First Nations and culturally and linguistically diverse (CALD) communities on their journey to financial independence.