We don’t need more financial goals. Instead, we need better systems for ourselves

If you are already falling behind on the well-intentioned resolutions you made on Jan 1, you’re probably not alone.

At the start of each year, many people make financial goals to save more, make more money or invest and get better returns. But these goals share a common flaw: They don’t specify how.

A friend of mine has been trying to save and invest for the past few years, but something more pressing always seemed to crop up to derail her plans.

In the first year, it was an unexpected medical bill for her father that was not covered by insurance. In the second year, it was a higher mortgage on her condominium (thanks to higher interest rates) and having to help her son who was falling behind in his studies. In the third year, she changed jobs and took a pay cut in order to move into a new industry.

Throughout these years, her mind and attention was always immediately needed elsewhere. She could never find the time or space to act on her financial plans.

I empathised with her, of course, but I felt the need to tell her that 2025 would likely turn out to be the same if she didn’t change her approach.

No matter how firm your initial resolve, even the best of financial resolutions can easily dissipate in the face of bills, payments and other life responsibilities and commitments.

So instead of simply declaring we will "save more" or "spend less", we need to clearly define what that looks like in the context of our lives. We need to set up systems for ourselves that will enable us to succeed.

CREATE SYSTEMS, NOT GRAND RESOLUTIONS

Here’s an example: Rather than stating you’ll build a S$10,000 emergency fund this year, break it down piece by piece.

For instance, could you aim to save S$850 a month? This is certainly a more manageable sum to plan around than S$10,000.

Next, design a system that will reduce or remove any inertia. What can you do to ensure your plan will be executed no matter what happens? 

For instance, you could set up a standing instruction with your bank to have S$850 automatically transferred to a separate savings account right after payday. 

Lucky enough to get a bonus? You could also consider immediately moving all of it into a separate, untouchable account.

For my friend’s investing goals, I pointed her towards regular savings plans offered by several brokerages operating in Singapore that can automatically invest her funds on a recurring schedule. All she needed to do was to spend a few minutes thinking of what she wants to invest in regularly throughout the year, then set up the account and automate the feature to invest on her behalf.

The key is to find a way to take care of the heavy lifting for ourselves, so that we don’t have to find the time or energy to do it manually – or even to remember or think of it at all – throughout the busy year. 

AUDIT WHAT WORKED AND WHAT DIDN’T WORK LAST YEAR

So how do we know what systems to set up for ourselves? 

One way to think about this is to first review your financial goals from last year and identify what helped or hindered you in achieving them.

For instance, in 2013, I had a practice of saving all my income left at the end of each month after expenses. Then, in my yearly review, I realised that my savings amounts often fluctuated and I usually ended up with a much smaller sum than I’d been aiming to save. 

So in 2014, I set up a system to turn this around by setting up a banking instruction to transfer a portion of my income into a separate savings account at the start of each month. That year, I successfully hit my S$20,000 savings goal for the first time.

Another example: If you found yourself having to pay late fees and interest on your credit card bills last year, setting a recurring reminder on your phone to check your credit card statements at the end of every billing cycle can help. (This can even help you spot any potentially fraudulent charges that need to be disputed before it is too late.) 

For a few years now, I’ve consistently taken time between 10pm and 11pm daily to check the stock markets and read financial news and analysis. However, I realised in my recent self-audit that for 2025, I would have to sleep earlier in order to take my Primary 1 kid to school by 7am. I’ve since moved my daily self-update to the hour of 8am to 9am instead.

It’s not enough to simply review your financial performance in terms of savings, spending categories, insurance policies and investment performance. 

Review the systems you have in place. What’s working well? What needs to be improved or abandoned altogether and replaced with something new? 

DON’T UNDERESTIMATE LIFESTYLE INERTIA

Goals like New Year resolutions are great for setting direction, but if we don’t take concrete steps in that direction, we’ll never get to where we want to be. 

Aside from rising costs and unexpected curveballs, we must also face our own lifestyle inertia. 

We all have spending habits that need to be regularly reviewed as well: Have we been dining out a little too frequently at expensive establishments? Do we spend a little too much on taxi rides instead of planning ahead to take the train? How much time do we spend scrolling through online shopping apps for things we don’t really need?

Motivation alone will not last long and old habits die hard. Real change comes in the incremental, consistent adjustments we make in our day-to-day lives, rather than any grand, sweeping declarations we make once a year.

Take care of the process and the outcome will take care of itself.

Dawn Cher, also known as SG Budget Babe, has been running a popular blog on personal finance for the last 10 years.