--- title: Avoid These 7 New-Year Money Mistakes That Could Doom Your Resolutions description: To find success with your money goals this year, avoid common mistakes, including setting a vague goal, focusing too much on debt and more. authors: - name: Kaitlin Mulhere role: Editor url: https://money.com/author/kaitlin-mulhere/ bio: Kaitlin Mulhere has been covering the intersection of college and personal finance since 2015. She enjoys breaking down the complexities of college costs and financial aid, and she also runs Money’s Best Colleges. education: University of Florida at_money_since: 2015 articles: 217 covers: - Personal Finance - Banking - Business - Career Advice - Credit - Credit Cards - Debt - Economy and Politics - Education - Health and Wellness - Housing - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Retirement - Shopping - Taxes social: - https://twitter.com/KMulhere - https://www.linkedin.com/in/kaitlin-mulhere-64503048/ editors: - name: Julia Glum role: Managing Editor url: https://money.com/author/julia-glum/ bio: Julia Glum joined Money in 2018 and specializes in covering financial trends that affect everyday Americans' wallets. She also writes Dollar Scholar, a weekly newsletter that teaches young adults how to navigate the messy world of money. education: University of Florida at_money_since: 2018 articles: 453 covers: - Personal Finance - Banking - Business - Career Advice - Credit - Credit Cards - Debt - Economy and Politics - Education - Health and Wellness - Housing - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Professional Services - Retirement - Shopping - Taxes - Technology also_seen_in: - Newsweek - International Business Times - CBS News - Good Morning America - WUSA9 - Pix 11 - The New York Times - Mashable - The Washington Post - CNBC - Politico social: - https://x.com/superjulia - https://www.linkedin.com/in/julia-glum published: '2024-01-03T15:32:58.000Z' modified: '2024-05-17T04:57:22.000Z' section: Personal Finance tags: - News word_count: 1348 canonical: https://money.com/new-year-resolutions-money-mistakes/ type: NewsArticle source: structured-blocks --- > **Disclosure:** We research all brands listed and may earn a fee from our partners. Research and financial considerations may influence how brands are displayed. Not all brands are included. [Learn more](https://money.com/page/disclaimer/). ![Long list coming out of coin purse](https://img.money.com/2023/12/New-Year-2024-Money-Mistakes.jpg) ***This article is part of Money's new-year checklist — a 10-step guide to crushing your financial goals in 2024 (and beyond). For expert advice on managing your student loans, claiming the EV tax credit and more, [read our cover story.](https://money.com/money-new-year-checklist/)*** * * * Every new year, many of us do the same dance: Set an ambitious New Year’s resolution while in a financial hangover after the holidays and then watch as that start-of-year momentum slowly disappears in the ensuing weeks. But research has shown that while many goal-setters do fail to keep their Jan. 1 vows, resolutions *can* actually be effective ways to change behavior, depending on how they’re framed. With that in mind, we’ve rounded up the biggest money mistakes that can doom your goals to save more, spend less, pay off debt or bring in more cash. It’s a new year, new you — for real this time. ## If you're carrying over $20,000 in debt, Debt Relief could be a fast track to financial freedom ### Select your state to begin applying for Accredited Debt Relief's program. [Visit Site](https://money.com/pr/p63c2d2aa2f3?ap_referrer=%2Fnew-year-resolutions-money-mistakes%2F) ## Mistake No. 1: Not setting a specific, achievable goal When it comes to making financial resolutions, you want a “Goldilocks goal” — something that isn’t so big as to be unachievable but isn’t so small that its effects are negligible. You also want to make sure you have a specific, measurable objective. That means vague plans to “save more money” or “make more money” are out. Instead, aim for “save $X every month” or “get an X% raise.” Don’t pull those numbers out of the sky. Stephanie Bucko, co-founder of the Los Angeles-based Mana Financial Life Design, likes using a benchmark formula: 60% of your take-home pay should go to necessary expenses and debt payment, 15% should be [stashed in savings](https://money.com/best-savings-accounts/) and the remaining 25% can be spent as you wish. "You still get to enjoy yourself,” Bucko says. “But it sets a really good balance between saving for your future and enjoying what you have today.” Of course, that formula isn’t going to be possible for some, particularly those living in expensive cities or parents with young kids. If that’s you, figure out how much you can devote to your resolution by mapping out how much cash you’re bringing in each month and how much you’re spending. Whatever is left over — that’s how much you have to work with for saving or [debt payments](https://money.com/how-to-get-out-of-debt/), says Berna Anat, author of *Money Out Loud*. ## Mistake No. 2: Paying down debt too aggressively This warning might surprise you, given that debt is the financial bogeyman. But particularly in today’s high-interest rate environment, where you can actually earn money in savings accounts and bonds are paying higher returns than they have in years, putting all of your efforts into paying down debt doesn’t always make sense, Bucko says. To be clear, [credit card debt should be paid off](https://money.com/how-to-pay-off-credit-card-debt/) as quickly as possible because it’s so expensive — the average card currently carries an interest rate of over 20%. But if you have a low, fixed interest rate on a mortgage or student loan, you’re likely better off paying that down over time while you also save and invest. Then, if you do build up extra savings, you can always go back and attack your debt, Bucko says. "But once you pay off that debt, you can’t go back in time and say, ‘Oh, wow, I wish I could save an emergency fund for this emergency time,’” she adds. ## Mistake No. 3: Keeping your financial resolution to yourself This can (and should) be the year you stop thinking about money as a solo project. "Everyone has problems with money, and yet it’s something that we’ve refused to talk about, which is nuts,” Anat says. Bringing at least one friend or family member into the “what” and “why” of your money goals provides some much-needed accountability. As a bonus, it’ll give you a built-in cheerleader for when things get hard. Having a money partner could mean scheduling regular check-ins where you talk about how you’re progressing and any upcoming potential obstacles (like, say, the temptation to splurge on a child’s birthday party or buy a new dress for a friend’s wedding). Or it can be as simple as sending a quick text every time you take a step toward your goal. Anat, for example, has a years-old group chat where any time someone deposits money into a savings account, they send the money emoji with wings (💸). "It is amazing how much psychologically that will earworm into your brain,” she says. “It’s just an emoji, but suddenly I feel a little competitive.” ## Mistake No. 4: Not using the right tools Changing our money habits is hard work. You want to make sure you’re taking advantage of any accounts or tools that can make it a bit easier. If, for example, you want to cut back on spending or free up money to pay off debt, test out budgeting tools like YNAB, Rocket Money, Much and PocketGuard. They’ll allow you to be more intentional about how you’re changing your habits by highlighting specific areas where you might be overspending. (While some budgeting apps are free, others do charge a fee. Be sure you know what your app of choice is costing you — and that it's worth the money.) If your goal is to save more money, consider stashing some of it in a certificate of deposit (CD) account, where [interest rates are higher](https://money.com/investing-cds-great-move-now/) than they’ve been in two decades, or a [high-yield savings account](https://money.com/best-high-yield-savings-accounts/), where the best options are paying more than 4%. ## The best time to start saving money is today ### A High-Yield Savings Account puts your financial goals within reach. With a higher than average yield, your savings will be in good hands. Click below and get started today. [View Rates](https://money.com/pr/uf637661d173?ap_referrer=%2Fnew-year-resolutions-money-mistakes%2F) ## Mistake No. 5: Not automating your savings If you’re like the roughly 40% of people who made a New Year’s resolution to save more money, here’s one of the easiest errors to avoid: Don’t simply plan to save whatever is left over at the end of the month. Instead, in January, set up automatic deposits to your savings that happen every time you get paid. You can set up recurring transfers from your checking account into a savings account, or, if your workplace allows it, have a percentage of each paycheck deposited directly into your savings. This is helpful in a few ways. For one, you pay yourself first, before you're tempted to spend it elsewhere. You’re also making things easier on yourself. Rather than having to proactively think about saving money every couple of weeks, you just do it once upfront. Now you have to act to *stop* saving, rather than the reverse. ## Mistake No. 6: Giving up when you mess up Even if you avoid every one of the mistakes above, chances are you’re going to mess up. (Sorry.) You’ll inevitably miss a savings deposit or you’ll overspend. You’ll carry a balance on your credit card after a particularly expensive month. When this happens, you don’t want to spiral into what Anat calls a “financial cone of shame.” Instead, she focuses on getting back on track while reminding herself that slip-ups are normal when trying to change deeply ingrained behaviors: “Mistakes are a part of it,” she says. “That’s how I know it’s working.” ## Mistake No. 7: Waiting to celebrate until you meet your goal Sure, some financial goals are long-term endeavors, like [saving for a home down payment](https://money.com/how-to-save-for-a-down-payment/) or finding that magical budget that allows you to save and spend. To keep you motivated along the way, plan regular check-ins to monitor and celebrate your progress. These can be quarterly, every six months or once a year — whichever works best for your personality. For more short-term targets, like saving for a summer trip, pick one day a month to track where you’re at, and then reward yourself by doing some trip planning to stay excited about why you're saving. "It doesn’t feel big on a month-to-month basis,” Bucko says. “But when you look back over a year, it’s pretty incredible what you can do.” ***Correction:** This story has been updated to correct the spelling of Berna Anat's name.* ![](https://s3.consumersadvocate.org/prd/image/image/25289/medium_2e7b27ce-b30d-40a3-beef-0139ecba6b47.png) If you owe over $20,000 or more, Freedom Debt Relief can help you get back on your feet! [Get Started](https://money.com/pr/u5c2defb44d4?ap_referrer=%2Fnew-year-resolutions-money-mistakes%2F) New Year, New Money Challenges: A Smart Way to Save or a Waste of Time? ```json { "@context": "https://schema.org", "@graph": [ { "@type": "BreadcrumbList", "@id": "https://money.com/new-year-resolutions-money-mistakes/#breadcrumb", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://money.com" }, { "@type": "ListItem", "position": 2, "name": "Personal Finance", "item": "https://money.com/personal-finance/" }, { "@type": "ListItem", "position": 3, "name": "Avoid These 7 New-Year Money Mistakes That Could Doom Your Resolutions" } ] }, { "@type": "WebSite", "@id": "https://money.com/#website", "url": "https://money.com", "name": "Money", "publisher": { "@id": "https://money.com/#organization" } }, { "@type": "WebPage", "@id": "https://money.com/new-year-resolutions-money-mistakes/#webpage", "url": "https://money.com/new-year-resolutions-money-mistakes/", "name": "Avoid These 7 New-Year Money Mistakes That Could Doom Your Resolutions", "isPartOf": { "@id": "https://money.com/#website" }, "datePublished": "2024-01-03T15:32:58.000Z", "mainEntity": { "@id": "https://money.com/new-year-resolutions-money-mistakes/" }, "inLanguage": "en-US", "breadcrumb": { "@id": "https://money.com/new-year-resolutions-money-mistakes/#breadcrumb" }, "dateModified": "2024-05-17T04:57:22.000Z" }, { "@type": "NewsArticle", "headline": "Avoid These 7 New-Year Money Mistakes That Could Doom Your Resolutions", "articleSection": "Personal Finance", "image": [ { "@type": "ImageObject", "url": "https://img.money.com/2023/12/New-Year-2024-Money-Mistakes.jpg", "width": 2880, "height": 1920, "caption": "New-Year-2024-Money-Mistakes" } ], "author": [ { "@type": "Person", "name": "Kaitlin Mulhere", "url": "https://money.com/author/kaitlin-mulhere/", "@id": "https://money.com/author/kaitlin-mulhere/#author", "description": "Kaitlin Mulhere has been covering the intersection of college and personal finance since 2015. 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