New Year: Same Old Resolutions?

The turn of the calendar year is often a time of reflection and planning. The transition from 2020 to 2021 has special meaning for many of us who fell sick, lost a job, or - worse still - lost a loved one. Today is a new day with renewed hope for our collective future and I, for one, am optimistic for a better "climate" in the coming months.

Why Make Resolutions?

A whopping 80% of New Year's resolutions fail according to an article published in Forbes1 in late 2019. It appears that the odds are stacked against us humans as we make a list, check it twice, and then find out if we are naughty or nice. But, it makes us feel good to write things down and plan them out for our annual goals. These goals (perhaps) keep us from falling deeper into mediocrity by reminding us that we CAN do better. But, WILL we?

What Are The Top 10?

In a November 2020 survey of 531 US adults, Statista2 found that 4 of the top 5 resolutions for 2021 focus on better physical and mental health. This theme continues as we look further down the list to round out the top 10. Number 6 pops out as perhaps a recent priority. It is far too easy to spend more time than planned looking at cute puppy photos or browsing recommendations for our new best friends.

  1. Exercise more (44%)
  2. Eat healthier (42%)
  3. Enjoy family (34%)
  4. Lose weight (31%)
  5. Live economically (30%)
  6. Limit social media (24%)
  7. Improve job performance (23%)
  8. Reduce job stress (20%)
  9. Quit smoking (19%)
  10. Reduce alcohol (15%)

One of the challenges of these resolutions is that they are typically rather vague and they may not be attached to a timeline with specific dates. Another challenge could be listing too many competing priorities for our time (exercise more vs. working more). Those of us who are fortunate enough to work remotely have more time to dedicate toward a simpler and healthier lifestyle.

Who Is Accountable?

One of the easiest ways to increase the likelihood of keeping our resolutions is to set SMART goals. SMART is an acronym for Specific, Measurable, Achievable, Relevant, and Timely. Creating and documenting a SMART goal is a great start to make it a reality. Sharing that goal with another person (roommate, family, friends, or coworkers) is the next step to make sure we stick to our plan. Touching base with that accountability partner at pre-planned intervals is the icing on the cake.

Another spin on the SMART goal concept is called a HARD goal. In this case, the letters represent Heartfelt, Animated, Required, and Difficult. They have to be important in order for us to feel the pressure for completion. Simple and easy goals are often thought of as "nice to have" rather than "pound the table" mission-critical milestones that are both urgent and important. These four words warrant some further description.

  • Heartfelt - the motivation must come from within our deepest core for the goal to be relevant to our success.
  • Animated - the more we can visualize ourselves performing the tedious tasks required to achieve the goal, the more likely we will complete them.
  • Required - the only way to define our own success leads directly through this goal.
  • Difficult - If it were easy, it would already be done.

We have all seen family, colleagues, and personalities achieve great things. This is often reflected in photos - or videos - of a graduation, promotion, or awards ceremony. What we rarely see is the countless hours spent doing the tedious tasks that made their success look easy and instantaneous.

How We Help!

JQR Capital is about to publish a "Leaderboard" on our website to document our client goals and show their progress toward those goals. All entries will use a hybrid of the SMART and HARD approaches and will be sorted by the latest update timestamp. The table below shows a mock up of this idea that we plan to put into effect on Monday, February 1.

PersonAgeGenderGoalProbabilityTrendUpdate
JQR56MRetirement99%^2020-12-31
ABC42FCollege63%^2020-12-30
DEF34MDebt54%v2020-12-29
GHI36FHouse75%-2020-12-28
JKL62MBoat18%^2020-12-27
MNO24FCar36%v2020-12-26
PQR49MRetirement55%-2020-12-25
STU45FCollege62%^2020-12-24
VWX27MDebt89%v2020-12-23
XZA37FHouse48%-2020-12-22


Please contact us if you would like to join our leaderboard. We hope you reach all of your goals for 2021 - and beyond. Thank you so much!

References

1https://www.forbes.com/sites/kathycaprino/2019/12/21/the-top-3-reasons-new-years-resolutions-fail-and-how-yours-can-succeed/?sh=1f5151ed6992

2https://www.statista.com/chart/23812/most-popular-new-year-resolutions-americans/

Location: 24 Mill Pond Dr, Granby, CT 06035, USA

Comments

Post a Comment

Popular posts from this blog

Strategic Versus Tactical Asset Allocation

Image
  Source : FRED Data, JQR Capital The Market Portfolio A few weeks ago we introduced a cash asset to augment our efficient frontier set of bond plus stock portfolios.The cash asset allowed us to combine cash with the one portfolio along the efficient frontier that had the highest return versus risk (AKA the Sharpe Ratio). This one portfolio can be thought of as the tangency portfolio or - more commonly - the market portfolio (MP). The mix of bonds versus stocks in the MP will change over time with changes in interest rates and changes in expected returns for our bond and stock indices. The chart below is a quick snapshot of how the risk free rate of cash interest (Rf) interacts with the efficient frontier to create the market portfolio (MP) at only one point in time. This snapshot was taken a few weeks ago. Source : FRED Data, JQR Capital Introducing Naive Forecasting  The chart shown above was generated using average return and risk data over the 1973 to 2022 time period. The hardest
Read more

Take Your 2023 RMDs

Image
  Take Your 2023 RMDs If someone in your family has turned 73 in 2023, it may be time to start taking the required minimum distributions (RMDs) from an old 401(k) or a traditional IRA. These distributions are required so that the IRS can collect tax revenues on these “before tax” contributions. The laws for these RMDs recently changed and HERE is a quick guide designed to help you estimate how much you need to take out before April 1, 2024. The good news is that the penalty for missing your RMD has gone down from 50% to 25%. Happy Holidays! Convert To A Roth IRA One way to minimize your lifetime tax burden may be to convert your old 401(k) to a Roth IRA. Two of my financial planning clients recently toyed with the idea of converting their before tax money to after tax money through the Roth conversion process. For one of them (a single female, aged 69), a Roth conversion could allow her to generate $55,413 in additional wealth over her expected lifetime. For the other planning client
Read more

The Four Most Dangerous Words

Image
The Four Most Dangerous Words... The late great Sir John Marks Templeton - of Templeton Growth Fund fame - once quipped that the four most dangerous words to an investor were: "this time is different." Many market strategists warn that the sky is falling or that the investing principles that worked in the past no longer hold true in this new world of artificial intelligence and political unrest. The truth is that the facts and situations are (slightly) different from anything in the near or distant past. The rest of the story is that the human reaction, however, is the same and reasonably predictable. Read MORE ! Mean Reversion Works In my blog post two weeks ago, I used the analogy of a spring traveling through time while being exposed to compression and extension forces. This spring never gets smushed into a pancake - just the way it never snaps in half. When the forces are briefly taken away, the spring reverts back to the normal (unforced) state. This same principle can b
Read more