Are Your Clients on Track with their Financial New Year’s Resolutions
According to an Ipsos survey, 80% of Canadians give up on their new year’s resolutions before the year is over, with the majority throwing in the towel before the end of February. Therefore, now may be a good time to check in with your clients and see how they’re getting on with the financial goals they set in January. If you find they’ve already given up, it may be time for a new approach.
So, let’s look at some tactics to help your clients get back on track with their 2021 financial goals.
- Set specific, measurable goals
Many of us start the year with well-intentioned but vague financial goals. These could be things like “save more”, “spend less”, or “pay down debt”. These goals are more likely to fail because they don’t make clear the specific actions that your clients need to take in order to achieve them. So, if your clients have given themselves vague goals for 2021, encourage them to change to something more specific like “save $50 a week” or “only spend $150 a week”.
- Make them achievable
Many of us start the year full of enthusiasm and make our financial resolutions too ambitious.
Perhaps a client of yours intended to save $200 a week but hasn’t managed to do so. At this point, many people get discouraged and give up entirely. If you have a client in this situation, discuss with them what they can afford. Even if this is just $25 a week, it’s a start. And more importantly, it’ll get them into the habit of saving and put them in a great position to increase that amount when they can afford to.
The same can be said if your client has a lot of debts to pay off. To someone with multiple credit cards and loans, getting out of debt can seem unachievable. So, rather than looking at their debt as a whole, have them focus on paying off the highest rate loan first. The sense of achievement gained from having one less debt will give them the boost they need to start tackling the next one. These little achievements along the way will keep them motivated to carry on.
- Automate as much as possible
It’s harder for temptation to disrupt your clients’ financial goals when those goals are taken out of their hands.
So, if your client aims to save or invest a certain amount each month, tell them to set up a direct debit into their investment or savings account at the beginning of each month. That way they’re less likely to accidently spend it or forget to invest.
On the other hand, if your client has a problem with overspending, have them open a separate spending account and set up a direct debit with a set allowance for the week. Since the rest of their money will be out of sight (and hopefully out of mind!), they’ll be less likely to slip up and overspend.
- Don’t let a slip up become a failure
Many of us slip up on the road to achieving our goals – perhaps your client overspends one week, forgets to put money into savings, or buys something new on their credit card. The issue isn’t the slip-up itself; it’s letting this become the new habit. The best you can do in this situation is tell your client not to miss a beat, dust themselves off, and start again.
- Look at new strategies
If in spite of efforts to save more and spend less, your 55+ clients are still facing monthly shortfalls, it may be the right time to introduce the CHIP Reverse Mortgage.
This can form a sensible part of a structured financial plan and can help your clients stick to their 2021 financial resolutions.
Oftentimes, a lot of emphasis is placed on making big changes at the beginning of the year. However, meaningful and lasting financial change is much less glamorous. By getting your clients to implement small, achievable habits, they’re much more likely to see that big change by the end of the year.
- Posted by Samrat
- On February 17, 2021
- 0 Comments
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