Contributor: Kristen Fricks-Roman
Company: Morgan Stanley Wealth Management
Title: Financial Advisor
If past unsuccessful attempts at sticking to your New Year’s resolutions have got you down, don’t let them. Whatever your previous goals were — to make and save more money, get more fit, be more organized, etc. — it is natural to be excited about a “do over” in the new year. But, the anticipation could turn into feeling overwhelmed, especially if those goals are not backed by solid planning.
As a financial advisor, I see this kind of nervous excitement when I sit down with my clients. I find that the biggest reason people abandon their New Year’s resolutions, financial ones in particular, is they set too many goals. And, unfortunately, many may have been unrealistic.
To get back on track, consider focusing on one or two new resolutions. The types of financial resolutions you make will likely depend on where you are in life or what your financial priorities are. To get you thinking, here are three focused, achievable financial resolutions that I often hear.
I want to maximize my retirement contributions. If you are currently participating in a 401(k), 403(b) or 457 plan through your company or organization, take time to evaluate the amount of your contributions and whether you can allocate more to those accounts. Employer-sponsored plans have become a major source of retirement savings, so they deserve extra attention. Many companies offer a matching provision for your contributions that equates to free money, so be sure to check your plan to see if you are taking full advantage of it.
I want to be more informed about investing my money. If you don’t have a good understanding of how to invest, you are not alone. The sooner you begin investing (ideally, in your 20s), the more time your money has to grow exponentially, so relatively small amounts add up significantly over time. The longer you wait (further into your 30s, 40s, and 50s, for example), the more likely it is that you’ll need a sizeable amount to start investing — or larger chunks contributed on a regular basis. Many helpful resources are available online and in bookstores to help you get up to speed on how investing works. Education is empowerment. And, as you learn more, you can position yourself to make better decisions.
I want to be more committed to my budget. The new year is an excellent time to reexamine your budget to make sure it is realistic and something you can stick to. If not, make the appropriate adjustments and keep your short- and long-term financial goals in mind. Having a meaningful conversation with your spouse or partner, and even your children, regarding your financial picture is important. Sharing with them can help everyone have a better understanding of the big picture and the importance of sticking to a budget. If you are single, find someone you trust who will hold you accountable in a way that works for you.
Make staying on track a habit. Remind yourself daily about your financial resolutions and goals for the new year. Talk about your financial goals with others, which will help you commit and be motivated to achieve them. Lastly, consider meeting with a professional financial advisor who can help you build and follow a solid plan.
Here’s to sticking to your resolutions and them yielding the prosperity you desire this year!
Kristen Fricks-Roman is a Financial Advisor with the Wealth Management Division of Morgan Stanley in Atlanta. The information contained in this article is not a solicitation to purchase or sell investments. Any information presented is general in nature and not intended to provide individually tailored investment advice. The strategies and/or investments referenced may not be suitable for all investors as the appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives. Investing involves risks and there is always the potential of losing money when you invest. The views expressed herein are those of the author and may not necessarily reflect the views of Morgan Stanley Wealth Management, or its affiliates. Information contained herein has been obtained from sources considered to be reliable, but we do not guarantee their accuracy or completeness. Morgan Stanley and its Financial Advisors do not provide tax or legal advice. Before investing, investors should consider whether tax or other benefits are only available for investments in the investor’s home state 529 college savings plan. Investors should carefully read the Program Disclosure statement, which contains more information on investment options, risk factors, fees and expenses, and possible tax consequences before purchasing a 529 plan. You can obtain a copy of the Program Disclosure Statement from the 529 plan sponsor or your Financial Advisor. Morgan Stanley Smith Barney, LLC, member SIPC. CRC 2235406 09/18