We’ve all been there: New Year’s Day rolls around and we set all sorts of goals. This will be the year we finally get on top of our budget, figure out what to do with those old 401Ks, pay off that debt, the list goes on. We download an app or buy a book, but nothing sticks. Why do we fail?
We fail when we make the mistake of relying on willpower to carry us through. Unfortunately, willpower is usually in short supply; we use it getting out of bed in the morning, trying to eat healthier, and attempting to keep up with dishes and laundry.
To make progress towards a goal, we need to get something on the calendar. For financial goals, I like to do this by scheduling Money Dates. It’s simple: Grab your calendar and schedule a monthly recurring 60-minute “Money Date.” You can include your partner if you share your finances.
Pick a time when you won’t feel rushed. Make yourself comfortable and set the mood– light a candle, pour a glass of wine, cuddle up with a blanket. Grab a notebook and a pen, and settle in. Here are the five ingredients to a productive money date:
Set Your Priority
Start by writing out your most important financial goal at the top of the page, then remind yourself why that’s important to you. For example, “My top financial goal is to get clarity around my spending. This is important to me because I want to feel confident and empowered with my money.” Reminding yourself of your most important goal will help you stay motivated.
Review Last Month’s Spending
Log in and review last month’s transactions on your bank accounts and credit cards. Pay attention to trends, such as spending more money on Amazon or eating out more often than you realized. Ask yourself if those spending habits support your values and the life you want to live. You’re the boss of your money and get to make the rules, so you do you here! Make some notes if there are any trends you’d like to change through mindful spending.
While you’re at it, look for transactions you don’t remember making. You may notice over-charges or fraudulent activity as you scan. If you do notice anything that looks fraudulent, you’ll want to deal with it ASAP; most institutions give you 60 days from the date of the charge to dispute them. Make note of any transactions you need to follow through on.
Review Your Subscriptions and Memberships
It’s happened to the best of us- we sign up for a free trial membership, planning to cancel before we get charged. We pause before entering our credit card information, then promise ourselves we’ll remember this time! But you know how the story plays out.
Take a moment to scan your subscriptions and memberships and ask yourself: Am I really using this? If not, make a note to cancel it. If you’re using it a little, look into whether you can save some money by downgrading your subscription level.
Review Your Balances
Draw a line down the middle of your page and write “what I own” above the left column and “what I owe” above the right. Log into your accounts and write down all of the balances. Add up the balances on the left and subtract the balance on the right. This is your “net worth,” a helpful number to track your financial progress.
You may find it helpful to use an app that lets you sync your accounts and credit cards, allowing you to see all of your balances and transactions in one place. Try to set your electronic device out of reach as soon as you finish this step so that you don’t get distracted by notifications.
Celebrate Your Accomplishments
Take a moment to look back at the progress you’ve made over the last month, and the last year. What did you follow through on? What did you achieve that you didn’t think you could? What are you proud of? Write it down!
I trust you’ll find that the routine of monthly Money Dates will set you on track to finding clarity and confidence for your money. Bellingham, 360.543.6322, moneymavenfinancial.com