New Year’s: the bad parties, the awkward countdowns, and that cheesy feeling of renewal you can’t help but fall for, just a little bit. Even if all that’s waiting for you on the other side of midnight is four more long months of winter, it’s hard not to get excited by the idea that 2023 is the year you pass the bar, start waking up early, or finally learn to tap dance (hey, we’re not judging).
Research shows that for Canadians, health and personal finance are top priorities1, with more specific goals like “saving more,” and “paying off debts”2 included within this category. Too bad that if you’re like me, there’s nothing like a New Year's resolution to make sure you don’t get something done. Anybody who’s had to line up for a Stairmaster at the gym in January, then returned to a relative ghost town in March, knows what I’m talking about. Often, I’m tempted to resolve to get divorced, go bankrupt, or get maimed in a fiery accident, as a twisted, reverse psychology psychic protection against these things actually happening.
So, in that spirit, but decidedly less violent, why not try these on for size?
Three financial New Year's resolutions we give you our full permission to bail on by the end of January—or sooner.
1. FEAR THE PLASTIC
I get it, some of us have a complicated history with credit cards. In most movies and television, our little plastic frenemies are synonymous with spending money you don’t have. And of course, there’s some truth to this, but it’s not necessarily the whole truth (and nothing but). The fact of the matter is good credit can really come in handy down the line when you’re looking to make big purchases like a car or property. So, as long as you actually do have the money to pay for things like groceries, gas, or tap dance lessons, it makes sense to charge them. Even if you don’t see any big-ticket items in your immediate future, building your credit now is one of the easiest ways to start establishing a strong financial foundation.
2. SAVE, SAVE, SAVE
Saving money is a little like working out or starting to eat healthy. Come January 1st, you go to the gym five days a week and only eat kale salad. Come February? We all know how that story goes. The financial equivalent sees you living on ramen noodles, declining plans with friends, and wearing hand-me-down winter boots that are two sizes too small and have holes in the soles, just so that you can save as much money as fast as possible. Stringent plans like these aren’t sustainable over the long term. And like a crash diet or strict gym regimen, they’re likely to lead not only to a complete abandonment of your original goal, but also the formation of associations between money, stress, and self-worth that can be hard to shake.
3. CLOSE YOUR EYES AND WISH FOR THE BEST
Money can be triggering for people for a lot of reasons, so it’s tempting to believe that the less we think about it, the better off we’ll be. And while nobody’s going to gaslight you into thinking those late-night insomnia sessions stressing over rent payments are healthy, the “out-of-sight-out-of-mind" school of thought paints an unnecessarily black and white picture. The problem most of us have isn’t that we think too much or too little about money, it’s the way we think about it. Maybe you’re not where you want to be financially right now. That’s okay. But shutting these things out because they make you uncomfortable isn’t going to make life any easier. Be honest about what you want and how you can feasibly get there. The journey will look different for everyone, but sometimes the solutions are so simple they’re more likely to put us to sleep than keep us up at night.
If statistics have anything to say about it, you just might fail at your New Year’s resolutions. So, why not game the system by choosing these three to ditch on purpose? After all, you probably worked really hard this year and there’s a lot you can be proud of. By all indications, 2023 will be even better for you. But that doesn’t mean you have to be flawless all the time. After all, ditching a bad habit can be just as important as creating a new one. So go ahead, start off the new year on a low note. We dare you.
We can help.
Goals are a big part of financial planning, the biggest. Resolutions? Not so much. A financial planner can help you define your goals and make a customized plan to achieve them. And because we’re a not-for-profit, we offer this service for the low, low price of free.
Written by Frankie Barnet.
Sources: 1. YouGov.com: “The most popular resolutions among Canadians,” January 2020. 2. Ipsos: “Finances, forecasts and fireworks: Four in Ten (41%) of Canadians are hailing in the new year with a resolution about their financial wellbeing,” December 2021.