How to Make New Year's Resolutions Stick

When it comes to financial ambitions, the trick is to involve friends—and strangers.

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It's that time of year when you look out over the next 12 months and ask yourself: "What would I like to accomplish?"

Financial goals, from paying off debt to saving enough for a tropical vacation, are almost as popular as losing weight. To make sure your money-saving ambitions don't go the way of the 6 a.m. workout (in other words, they're long forgotten by Valentine's Day), try these expert-recommended techniques:

  • Share your goals with friendsand strangers. Gretchen Rubin at the Happiness Project says that by telling other people about your resolutions, you increase the chances that you'll stick to them. Verbalizing what your goals are to others can also help you get specific, another one of her recommendations. She writes on her blog, "Don't resolve to 'Make more friends' or 'Strengthen friendships'; that's too vague. To make more friends as part of my happiness project, I have several very concrete resolutions like: 'Start a group,' 'Remember birthdays,' 'Say hello,' 'Make plans,' 'Show up,' and 'No gossip.' "
  • You don't necessarily have to share your goals with people you know. At 43things.com, strangers list goals, such as "save 20 percent of what I earn" or "identify 100 things that make me happy (besides money)." Explore the "money and wealth" section to pick up ideas for your own list, and get encouragement by cheering people on and having them cheer you on.

    • Dare yourself. In Nudge: Improving Decisions About Health, Wealth, and Happiness, economists Richard Thaler and Cass Sunstein write that people often need help executing their goals, even when they have the best intentions. In other words, they need a "nudge."
    • One solution Thaler and Sunstein identify is the concept behind the website Stickk.com, which was created by fellow economists. It lets people back up their goals with financial or nonfinancial incentives. For example, if you want to stop wasting money on happy-hour martinis, you can put up $100. If you achieve the goal, you keep the money. If you don't, then you pay it, either to a charity or to another recipient of your choice.

      If your resolution happens to be waking up earlier, perhaps to enable you to balance your checkbook or work an extra hour, then another tool that can serve as a "nudge" is the invention known as Clocky. It's an alarm clock that runs away and makes irritating sounds if you don't wake up when it goes off. That's one way to force yourself out of bed.

      • Look back. Part of moving forward requires a year-end review of your finances, says Gail Cunningham of the National Foundation for Credit Counseling. She recommends writing down everything you spend for 30 days so you notice patterns of expenditures that might be slipping through your fingers unnoticed. Some credit card companies provide this service free; just log in and look for a tool that analyzes prior spending.
        • Get out your pen. Dawn Handschuh, a regular contributor at CreditFYI.com, says that putting goals on paper (or on your computer monitor) increases the chances that you'll achieve them. She also recommends posting them near your desk or on the fridge, so you're reminded of them every day. Then, she adds, revisit them in more detail once a month.
          • Treat debt like the plague. With the average American responsible for over $17,000 in debt (excluding mortgages), Cunningham says paying it off should be a priority in 2009. The first step is to stop adding to existing debt by living within your means. Next, pay off credit cards where the balance exceeds 30 percent of the credit limit. (Getting too close to that limit can hurt credit scores.) Then, focus on paying off the cards with the highest interest rates. (Since experts expect credit to remain tight throughout 2009, it won't be easy to find the superlow rates that were common back in 2004 and 2005.)
            • Say goodbye to Netflix. Recurring expenses get multiplied each month, so even cutting something small—like a daily latte or premium cable—adds up to big bucks throughout the year. But don't be intimidated, says Handschuh: "Remember that an 'either-or' approach isn't necessary; often, all that's needed is downsizing, not elimination."