A new year is upon us. This is the time when millions of people often try (and fail) to make promises they call New Year Resolutions. Some people share their resolutions, and others will keep their health and financial goals private. Either way, the majority of people will give up within the first month. The overriding reason for this is because resolutions tend to be too broad and vague to accomplish. Today, I want to challenge you to think of your New Year Resolutions as SMART Goals (Specific, Measurable, Attainable, Relevant, and Timely).

Below I have outlined some financial goals that you can achieve in 2021. Each one can be adapted to your lifestyle and be made SMART.

SMART Financial Goal #1: Understand Your Cash Flow

Your cash flow is easy to track and understanding it will yield tremendous benefits. Knowing the details of your cash flow will assist you in setting up a budget for the new year. It will also increase your personal satisfaction as you become more aware of where you are spending your hard-earned money. While cash flow management is a broad topic, let’s discuss how to make this financial goal SMART.

First, we need to make it specific. Begin by making a budget that captures all your income and expenses. There are dozens of resources available to help you do this. For example, at Access Wealth, we provide clients with an online platform that automatically creates a budget by analyzing their transactions!

Once you have a budget, you need to measure it, which is just a matter of making sure you stay disciplined and within your allotted allowances. If you find that you are experiencing a shortfall, adjust the budget to make it more attainable. You’ll know it’s right when you no longer see negative numbers. Along the way, make sure the budget stays relevant to you and what you want to accomplish, such as saving for a vacation or a house. Finally, understanding your cash flow should help you determine how long it will take you to achieve your financial and personal goals (timely).

If you are nearing retirement, read this article to help you budget for retirement, so you don’t outlive your money.

SMART Financial Goal #2: Increase Your Retirement Plan

Once you understand your cash flow and budget, it’s time to review your retirement plan contributions. Contribute as much as possible to the plan to ensure you are maximizing the tax and growth opportunities that retirement plans afford. If you’re fortunate enough to work for an organization that offers a company match, do not leave any money on the table!

This financial goal is entirely SMART. It is specific to your retirement plan and easily measurable by checking on your contributions and performance. Because you already have a budget, increasing your retirement plan should be attainable. It is relevant because you likely want to retire at some point, and timely because you can set a retirement goal and then save accordingly.

SMART Financial Goal #3 – Build up an Emergency Savings

The Federal Reserve has stated that 40% of Americans can’t cover a $400 emergency with cash. Regardless of how much money you make, it’s critical to have savings available if the unexpected happens. Therefore, a very sensible financial goal for 2021 is to set up an emergency savings account. We can do even better by making this financial resolution SMART. First, define a specific amount (e.g. $10,000). It is generally recommended that you save enough money to cover at least three months of expenses and preferably six months. This goal can be measured by setting aside a specific amount of money each month, earmarked solely for emergencies. The amount should be attainable if you’ve accounted for it in your budget, and it’s certainly relevant because the unexpected does happen. Commit yourself to timely check-ins on the account to ensure you are meeting your savings goal.

SMART Financial Goal #4: Protect Your Digital Footprint

Unfortunately, your online presence has probably been captured by dozens of nefarious databases, all collecting valuable information about you. That is why it is important to be diligent. Close online accounts you no longer use, clear your browsing history often (especially if you use a portable device to surf the web), and change your passwords frequently. If you haven’t updated your passwords recently, now is a good time to do so. Make it a SMART goal to secure yourself against identity theft and credit card theft this year.

Make it specific and measurable by listing all the websites you use containing sensitive information, such as your social security number or bank and credit card information, and tracking how often you change each password. Ensure it is timely by setting a date by when you will complete the process. For example, by the end of March, you will have reviewed all your accounts and changed your old passwords.

You can make your accounts even more secure by enabling two-factor authentication. If you have a Google or Apple account, your passwords will likely be stored by these companies (unless you opt-out). You can access your saved passwords on Google Chrome by visiting passwords.google.com. If you own Apple products, see the Settings application on each device.

SMART Financial Goal #5: Focus on Physical and Mental Health, in Addition to Financial Health

There is a clear and strong connection between physical, emotional, and financial health, which became very apparent for many individuals in 2020.

According to the American Psychological Association, money and the economy are two of the biggest stress sources. Another significant source of stress is one’s health (or lack thereof). The average person spends thousands of dollars on healthcare-related expenses each year.

This underscores the importance of getting your financial house in order, exercising regularly, and engaging in other healthy practices to reduce your stress levels and health care costs. It may not be easy, but this is one resolution that will certainly pay dividends in multiple areas of your life. That’s especially true now, as we face unprecedented health and financial challenges as well as increased stress levels due to the COVID-19 pandemic.

You can make this resolution SMART by setting a specific goal, like going on a daily or weekly walk, committing yourself to eat healthy, or seeing a therapist to help you communicate your feelings. Ensure it’s attainable by being realistic. If you’ve never exercised before, don’t commit yourself to run a half marathon by summer. Start with a walk around the block and build up from there. Hold yourself accountable by creating a schedule and marking the days you engaged in your committed actions. These activities can usually be measured by gauging the thing you were targeting – your mental state, your weight, or your energy levels, for example.

“If you begin to make small healthy changes to your diet, increase exercise in small increments, and practice yoga and meditation, you will feel better,” says Deborah Bauer, a distinguished senior instructor of finance at the University of Oregon. “Feeling better will lead to wiser financial decisions that focus on the long-term.”

While the new year’s start is a popular time for financial resolutions and health resolutions, it does not need to be the only time. Setting and achieving SMART financial goals can happen all year long. Consider these activities to be an investment in yourself.