It’s that time of year.
You made your new year’s resolutions a matter of weeks ago, and now you’ve reached that make-or-break stage.
Have they passed their expiry date, or are they still fresh?
If the latter, you’re in with a chance.
If they’ve gone stale on you, this might be the point at which you part company with them, for another year at least. Unless, of course, you’re prepared to look at – and address – the reasons why your resolutions have faded so quickly.
In my experience, when it comes to setting a budget for the new year, the problem is often that people aren’t realistic about their financial starting point.
Here’s what I mean. Everyone is either going backwards financially, standing still or going forwards. If you are in the going-backwards camp (ie, if you are accruing debt or arrears), but you actually believe that you are standing still, you are bound to be disappointed by the lack of progress in the first few weeks of your budget and will probably throw in the towel as a result.
If, though, you are realistic about your negative progress to begin with, you will be happy to make it to the ‘treading-water’ stage, as you will recognise this for the improvement that it is.
You probably wouldn’t try jumping from a moving train onto the train which is passing you in the opposite direction. Instead, you would stop at the next station, get off and then board another train from there.
In the same way, it is neither feasible nor desirable to go straight from one financial extreme to the other.
Only by proceeding in a conscious fashion (including awareness of your starting point), one step at a time, do you get to enjoy the progress you are making and absorb the lessons you learn along the way . . . the perfect recipe for lasting change.
David Rankin is an author, public speaker and founder of the award-winning personal budgeting service Sort My Money. This article does not offer personal financial advice.