As the New Year approaches, many of us will be thinking back on how our lives have changed over the past 12 months, and setting goals for the new year with determination. The most common resolutions for the new year are joining a gym, quitting a habit, or learning new skills. But have you considered making ‘enjoying a happier, healthier relationship with money’ your New Year’s resolution?

Whether you're aiming for short-term savings goals or planning for major life changes, setting New Year financial resolutions is a great way to take control of your money and your life. Achieving our big life goals often involves savvy money management. So Loqbox is here to explore 11 popular New Year’s resolution ideas to kickstart your journey to financial wellbeing.

How to set financial goals for the new year

Set realistic New Year’s resolutions

When you start planning new goals for the New Year, begin with what you want to achieve in both the short and long term. Focus on things you really want, so you stay hungry for them. Try to keep your goals realistic, or at least break down bigger ambitions into bite size chunks. Achieving small, realistic milestones can help you stay motivated to achieve your long-term goals.

Short-term goals might include things like saving for a holiday, making renovations, or buying a new car. Realistic and achievable ambitions can make great first financial goals for New Year's. Smashing targets is rocket fuel for tackling bigger ambitions in the future. So give yourself the right mindset by starting small and growing your ambitions.

Long-term financial goals for the New Year could be life-changing. Are you starting a family, dreaming of home ownership, building an extension, or turning your rental into a forever home? Goals like these can require daunting sums of money that can seem impossible, which is why we sometimes don’t shoot for the moon when we could.

But, when it comes to bigger ambitions and hitting our longer-term targets, instead of looking up at the whole mountain, try to focus on the checkpoints along the way. In other words, rather than thinking about the grand total, set achievable milestones instead. Turn long-term goals into a series of short-term wins to stay on track.

For some of us, before we even think about saving for the future, clearing our debts, growing our credit and balancing our finances can feel like an insurmountable task. But you can use the same approach to sort out your financial wellbeing. Start small, get organised, and above all, stick with it. You’ll be amazed at what you can do with some planning.

Find a way to achieve your goals with Loqbox! Download the waypower map to set your goals, plan your milestones, and stay motivated. 

Automate your New Year’s resolutions

Whether you’re paying off debts or saving towards a goal, you could set a New Year’s resolution to automate all of your payments. Direct Debits and standing orders can be fantastic tools for managing and organising your finances. And they’re free and easy to set up. Make sure that all of your regular payments are automatic. Why risk human error?

Another hack is to set your automated payments to go out on, or just after, payday. That way your financial obligations are sorted before you’ve even had the temptation to spend your money on anything else. Automatic payments make your life easier and keep you on track towards your financial goals. That’s a resolution you can smash on January 1st!

So, where do you start with planning financial goals for the new year? Let’s get into it.

11 ideas for New Year’s resolutions

So, let’s set goals for the New Year, which can help boost your money and your sense of financial wellbeing — that’s a feeling of security and control around money. It may not be one of the most common New Year's resolutions, but lifting financial weight off of your shoulders can help you focus on improving other aspects of your life.

Here is Loqbox’s list of resolutions for a new year and a new financial you. 

1. Create a New Year budget that works for you

A budget is your financial foundation. Before you can tackle your finances, you need to understand them. Whatever big goals you’re working towards, sticking to this New Year’s resolution could help to set you up for success! Take some time to review your income and outgoings. Work out the total income of all the relevant people in your home, then grab all of your bank statements and work out where your money goes.

You might start to see unhelpful spending patterns or financial imbalances you didn’t even know were impacting you. Try to break down your outgoings into the things that you absolutely need to pay for, like rent and bills, and the things that you probably just want, such as luxuries and entertainment. This can help to prioritise your finances. 

There’s nothing wrong with having luxuries. You earn your money so you deserve to have the things you want. But sometimes these little luxuries can add up, so you may need to balance them against your short and long-term goals.

You can read about different types of budgeting rules here, to find one that suits your finances the best. But they all work along a similar theme. Take the 50/20/30 rule, for example. With this budget, you break your income into three chunks: 50% for the things you need, 20% for your goals, and 30% for the things you want. 

By organising your income in this way, you can set a realistic target to save or put towards your debts every month. Of course, if you can afford more, you can up your ‘goals’ chunk, but you may equally find that the cost of living means that you need a bigger percentage for your ‘needs’. Budgets can be flexible to your needs.

2. Learn new ways to manage your money

Just as you might decide to declutter and clean your home in January, your finances could probably use a bit of spring cleaning too. With your budget in hand, you can review things like your subscriptions, memberships and services. If your ‘needs’ take up too big a portion of your income, perhaps it’s time to start negotiating your bills?

You might be surprised how much you can save just by updating your finances, spending a bit of time on your outgoings, and making a few sacrifices. All of that can become fuel for your New Year’s resolutions to save money or clear debts. Keep an eye on the prize and be honest with yourself about how much you truly need, and try to prioritise your ‘wants’.

3. Start your journey to the home of your dreams

Whether you want to buy your dream home, make a rental into your forever home, or even just make yourself feel more at home with renovations or extensions, mortgages and large loans can be scary things to put on your New Year’s resolutions list. But Loqbox is here to empower you to go after the things you really want in life.

From saving for a mortgage deposit to getting your applications approved, Loqbox is with you all the way to boost your confidence, your savings and your credit scores. A better credit score can help to get you the best possible deals when it comes to interest rates. On a large loan, like a mortgage, that can save you £1,000s in the long term.

When it comes to getting a “yes” from landlords or mortgage providers, credit scores are really important. But often, those regular rent payments you make aren’t taken into account when creditors assess your ability to pay for a mortgage. With Loqbox, your rent can build your credit history, putting the power back in your hands. 

Read more about how Loqbox can help you on your journey to a better living situation here. 

Improvements to your credit score are not guaranteed. 

4. Get on the road with a new car or vehicle

For some of us, nesting is the big life goal. But for others, it’s the freedom and independence you get from having a vehicle. Having your own set of wheels can really widen your horizons. Not only that, but saving towards and reaching your resolutions can give your financial confidence a boost and encourage you to hit new targets.

Whether you’re saving for a new car or motorbike or dreaming about the freedom of van life, Loqbox helps you to work towards your savings goal while also improving your credit score. Our members save £540 a year on average. With a better credit score you can level up your financial flexibility, opening up better deals for things like car finance. 

Improvements to your credit score are not guaranteed. 

5. Explore new places, travel the world, or enjoy a holiday

Houses and cars are expensive. Depending on your budget, you might want to find your fun and freedom in a different way. Travelling is a common New Year’s resolution. Whether you’re heading for white sands on the other side of the world, hopping on a train to ‘do' Europe, or hitting a road trip across the States, Loqbox is here to support your plans.

Find out how to save for the trip of a lifetime! 

6. Become more financially secure by clearing your debts and saving an emergency fund 

If you have lots of debt or high-interest obligations, it might make more sense to clear them from your finances before you attempt to save towards short or long-term goals. Loans will often take more from your income through interest payments than you will make in interest from savings accounts. Ultimately, clearing your debts boosts your saving power. 

There are two approaches to clearing multiple debts. You can either tackle the biggest, or highest interest, debts first and then start to mop up the smaller ones. This is known as the avalanche method. Or you can start with the smaller and easier debts to clear the decks so you can focus on your bigger commitments. That’s known as the snowball method.

Once you’ve cleared your finances to a point where you can start saving, you could set a New Year financial resolution to build an emergency fund. Life’s unpredictable, and having an emergency fund is important for your financial stability. It’s a savings pot that can cover you for unexpected events like job loss, car breakdowns, or urgent house repairs.

Ideally, your emergency fund would be able to support between three to six months' worth of your living expenses. It might make sense to keep your emergency fund in an easy access savings account and it's important not to touch it unless you absolutely have to. Remember, it is a safety net for you and your family. Keep it separate from your day-to-day finances.

Check out our bank account cheat sheet to find the right savings account for you. 

7. Build a savings habit that sticks

If you’re setting a New Year resolution to save money, it can help to have a savings goal in mind. For example, if you want to save for something specific — like a new sofa — you could write the total amount you need to save down, and break that down into monthly savings amounts. 

Stay informed about the latest savings rates to make the most of your savings growth. Consider moving your money to higher-interest accounts to make your money work harder for you. Shop around for the best deals and find options that make the most sense for you and your individual financial needs. 

Alternatively, Loqbox empowers you to build a savings habit you can easily stick to, while also building your credit score. You can smash two resolutions in one - by saving towards a goal while also improving your credit score. 

Join Loqbox, set your savings goal, and we’ll report your monthly payments to the top three credit reference agencies (CRAs) in the UK: Experian, Equifax and TransUnion. That helps to grow your credit score and at the end of the year, you’ll have smashed your savings goal too. Win win! 

Improvements to your credit score are not guaranteed. 

You can read more about the CRAs, and the differences between them, here.

8. Start saving for for a financially secure future

No matter your age, it's never too early to start saving for retirement. The earlier you start putting money into your pension pot, the easier it will be to meet your targets. If you have a job you might be contributing to your workplace pension, along with your employer. This can contribute approximately 8% to your pension. 

But it is often suggested that you will need more than that to get a decent retirement income. You can choose to add more to your contributions, or you can look for employers who give bigger percentages from their end. But ultimately you may need to start saving or investing to build your pot up.

9. Grow your credit score

A healthy credit score opens doors to better financial opportunities. Not only does a good credit score improve your chances of being accepted for lines of credit, but it can also land you the best interest rates. Remember, when it comes to a mortgage for example, a lower interest rate can save you £1,000s in the long run. So what are you waiting for.

There are lots of things you can do to improve your credit score. You can read more about credit scores and how to spring-clean them here. But if you want a fast and proven way to hit your New Year’s resolution of growing your credit score, boost your credit score with full Loqbox membership. For £2.50 per week, you get access to all of our powerful credit-building tools. Members see an improvement of 125 points in the first six months on average.

Improvements to your credit score are not guaranteed. 

10. Think about investing your money

If you have stable finances, and you’ve already grown your savings pots for emergencies or retirement, you could benefit from making your money work for you. Whether it's stocks, bonds, or mutual funds, investing can help you build wealth and achieve long-term financial goals.

Investing your money has the potential to yield much higher returns, sometimes much faster, than the interest you earn from your savings. But it’s important to say that there are also far bigger risks and you could even end up with less money than you started with. If you’re interested in investing, set a New Year’s resolution to learn more about it first. Blogs like this one are a great place to start, but you could also consider speaking to a financial advisor.

You can invest in anything from stocks and shares to fine wines and art. You can also find apps that take control of your money and you can spread your investment across diversified portfolios. This can lower the risks and take some of the responsibility for specific investment decisions out of your hands. 

11. Invest in yourself

Regardless of which of these New Year’s financial resolutions you decide to focus on, build up your money confidence by putting time into your financial literacy. In simple terms, financial literacy is about knowing how to make good decisions when it comes to money management and using financial products and services to best suit your needs.

Financial literacy is important because it gives you the tools to make the most of your money, to avoid financial traps that can eat away at your personal wealth, and to build a solid foundation for the future.

Investing in your skills and education can also make a significant impact on your earning potential. Look for courses, attend workshops, or pursue certifications that can boost your professional growth. You can read more about financial literacy here.

Set yourself up for a happy New Year!

Whatever New Year’s resolutions ideas you decide are right for you, the most important thing is to try and stick with them. Persistence and determination are probably your greatest superpower when it comes to levelling up your financial situation. 

Remember the best financial New Year’s resolutions start with an overview of your income and expenses, then create a budget, and clear your high-interest debts, before you build a savings foundation that can act as a springboard for potential investments.

Above all, have a very happy financial New Year!