Dave Ramsey: 5 Ways To Make Your New Year’s Money Resolutions a Reality
Written by
Jordan Rosenfeld
Edited by
Molly Sullivan
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If you’re an eager resolution setter who sees the new year as a fresh start, you’re probably keen to take advice from experts who can help you get your finances in shape.
The new year is also often a quieter time of the year when you’re likely to be spending less, traveling less and focused more on what’s going on in your life at the moment.
Here’s what finance expert Dave Ramsey, of Ramsey Solutions, has to say if you want to make your New Year’s money resolutions a reality.
Know What You Want
A goal is just a goal until you get specific with it, Ramsey suggested. He recommended getting “super specific” and narrowing your goals down into concrete achievements that go beyond the general. A goal like “get my finances in order” won’t be as easy to achieve as “create a budget.”
He recommended you ask yourself some key questions, such as: What am I trying to accomplish here? Why do I want to make this goal happen?
Also, look out for potential roadblocks — though some of these could be surprises, if you plan for the obvious ones, you can get ahead of them.
Make Your Goals Measurable
Beyond specific you need to make your goals measurable, Ramsey has said. Though he makes the case of weight loss on his site, suggesting that “lose 20 pounds” is more concrete than “lose weight,” the same goes for your finances. “Save for a car” is vague. “Save $100 per month for a car I’ll buy in 2025” is concrete and measurable.
If necessary, he wrote, break your goal into “bite-sized chunks” such as daily, weekly and monthly steps that you can focus on. Don’t stop when you’ve achieved one or several goals, either. He recommended asking yourself some leading questions that help you measure the success of your goals, such as: How long will it take to reach my goal? How do I know when I’ve reached my goal?
Set a Time Limit on Financial Goals
It’s very hard to reach a goal that is open-ended and goes on indefinitely. “Save for a house” is admirable, but how do you know when you’ve reached it? Try “Save X dollars per month for two years to build up a down payment.”
Ramsey wrote that time limits are important “because you need a finish line.”
He returned to the idea of daily activities. If your goals are too diffuse, such as once a month, it might be easy to forget about them or miss them. He offered the following important questions: Do I have a deadline for reaching my goal? When will I hit this goal? How many times will I achieve this goal?
Personalize Your Goals
If you’ve set a financial goal because someone else told you to or you’re following someone else’s lead but it doesn’t come from your own personal motivation, you probably won’t have much success, Ramsey suggested. “Why? Because working hard to win isn’t for the faint of heart. It’s tough. And you won’t have the drive to stick with it if you’re working toward a goal you’re not even passionate about.”
For example, he said, just because a spouse wants to get out of debt doesn’t mean you’ll do so. You also have to want that goal. Hint: Think about what you can free up money for when you do get out of debt, or whatever the goal is to check in with yourself about whether you feel passionate about it or not. Ask yourself: Is this my goal? Or is it someone else’s goal for me?
Write Your Goals Down
Not only does writing a goal down make it concrete and easy to see, it’s sort of like making a contract with yourself that you will do it. It can also be a way to help you look at what some of the smaller tasks and steps are related to your goal.
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