Why Is Sticking to Your Financial Resolution So Hard?

18 November 2022
3 min read
Why Is Sticking to Your Financial Resolution So Hard?
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We all made a few financial resolutions at the beginning of the year.

Which was. “Saving Money”

But most of us have already given up on them, haven’t we? A lot of us wonder what the point of making these resolutions are.

Not overspending, making a budget, not spending on luxuries, do these little things impact our financial future at all?

You’re mistaken. These are small things, but they make a big difference in our lives!

If you are frustrated about why your bank balance does not increase, I’ll tell you a secret, it’s probably the most simple thing you aren’t doing, drifting you away from your resolution.

In this article, I will ask you five questions to help you analyze why you aren’t meeting your financial resolutions.

1. Are You Investing?

I can’t stress enough on the importance of investing

Whether you are a beginner or well-established in your career, investing is a must in today’s day and age. Remember, earning money is not the end of your goal; increasing that money substantially is.

These days, options like stocks and mutual funds are popularly referred to as the ‘investing option of the millennials’.

If you think investing in these instruments is jumping into a pool of risk, you’re wrong again!

Instruments like mutual funds comprise low-risk options (debt and liquid funds), which provide higher returns than securities like fixed deposits and savings bank accounts.

2. Are You Using Your Credit Card Way too Often?

Psychologists have established that shopping is as addictive as alcohol. And the purchase of something new always gives satisfaction to humans.

With the introduction of credit cards, the message is loud and clear: You can have what you want and satisfy your wants!

A credit card can be used in several establishments and gives you easy access to buy something for which you don’t have to pay immediately.

It is not surprising that credit card debt is rising steadily at a high rate.

Moreover, you can say that over-spending has become a norm among youngsters especially. This is because most of our economy depends on consumption. Thus overspending plays an essential role in creating our economy.

There are various credit card debt counsellors, credit card debt support groups, credit card debt consolidators, and budgeting software that support you and add to your expense.

We’re not saying that credit cards do not help you, but you need to know how to use them wisely and when to use them. You must only subscribe to a credit card if you can control your urge not to overspend and settle off your debt in time.

3. What are You Spending On?

If we dig deeper, the fact is that most people do not want to know what they spend.

They are comfortable in the denial zone and do not want to plan their finances. Some people also fear tracking their daily or weekly expenses will make them fun-deprived and life-hating.

Thus, they are ready to risk their financial health.

You need to know three things:

  1. Where are you spending money?
  2. On what are you spending money?
  3. How can you decrease unnecessary expenses?

Once you answer these three questions, you can move on to the next step, making your budget.

4. Are You Keeping a Financial Record?

You must take a step forward to keep things simple and easy to manage.

Many people think that keeping a record of your spending is time-consuming, but trust me, it will not take more than 10 minutes of your time every day.

Think of it this way.

You go out to eat on the weekend, come back, and note it down in your budget diary. Slowly but surely, when this becomes a habit, you will be able to realize where you’re spending unnecessarily, and you can cut down on your expenses accordingly.

Next, you can budget and decide how much you can spend on each segment.

5. Is Your Income Aligned With Your Expense?

The last question I want to ask you is, are you spending according to your income?

Many people, especially the ones who have just started working, spend more money than they earn; this is the root cause for subscribing to credit cards.

It is, in fact, foolish to spend 20,000 on a bag if your salary is only 15,000!

Always spend money on your earning abilities!

You may also want to know the 30 Things About Money You Need To Learn Before You Turn 30

Conclusion

We hope these five questions will help you make sound financial decisions and make financial planning easy!

Remember, every penny counts!

Happy Investing!

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