There were many interesting sayings I learned during optometry school.  My favorite one was “Those who can’t do…teach.  Those who can’t teach…teach optometry.”  This saying was partially in jest, but partially not.  Anyway, another saying which applies to pretty much any healthcare field is “Prevention is better than cure”.  I really appreciate the wisdom behind this idea as I know from experience that it’s much better to nip problems in the bud by practicing what your doctor actually recommends.  I firmly believe that the majority of health problems that plague this country (diabetes, high blood pressure, high cholesterol) could be decreased drastically if people took steps to prevent them from happening in the first place.

I see this a lot with people who abuse their contact lenses.  I tell every contact lens patient to never sleep in their lenses and to always throw them out at the recommended intervals.  There is no other reason I tell them this than to minimize the possibility of an eye infection, which are painful, inconvenient and costly.  Most people start listening to my recommendations after getting an eye infection.  It’s great that they turned over a new leaf, but it would be even better if the proper instructions were followed in the first place.

Why am I venting about my non-compliant patients on this finance blog?  It’s really fun.  And also I think the same principle can be applied to our finances.  It’s awesome that someone saw the light after paying off their massive credit card bills that took 5 years and a lot of stress.  But it would be even better if that person never got into credit card debt in the first place.  It would have saved them a lot of stress if course, but it would also have saved them a lot of money.  Money that could have been used to increase an emergency fund, invest in an IRA or make a down payment on a house.

I realize that everyone makes mistakes in their financial life.  I’ve made a whole bunch of them.  Learning from our own mistakes is a key and essential trait to grow financially and in virtually every other way.  But we don’t have to make that many in order to learn our lesson.  Some things such as falling into credit card debt or not saving enough are easy to avoid but can lead to disastrous results.

Just like consistently eating healthy and moderate exercise will most likely keep us very healthy, small, simple things that we can do everyday such as networking or finding ways to make more money can make our financial situation very strong.  But just as neglecting exercise for a long time can all of sudden lead to heart disease, not doing the small financially responsible things can tear apart our finances.

So how are those 2013 New Year’s resolutions going?  Do you even remember what they were?  If they were something like “lose weight” or “stop spending so much”, you most likely didn’t stick to them.  And that’s okay.  Because it’s good to know what DOESN’T work as much as what does.

What doesn’t work is making abstract and lofty goals.  These goals can be motivating at first, but they will most likely lead you to burnout and eventually abandon the goal.  This is especially true with making financial resolutions.  Improving our finances is one of the most common resolutions made at the end of the year.  And who doesn’t want to improve their finances?  We all want to be able to spend money on what we want and save it for when we need it most.  New Year resolutions, especially financial resolutions, need to be very specific.  A goal such as “save for retirement” or “invest more” is still pretty abstract because retirement can seem so far away and we don’t usually realize investment gains after some time.  These resolutions need to be very specific and most important of all, measurable.

Here are a few guidelines when making your financial New Year resolutions for 2014:

Make resolutions early:  If you’re serious about making new habits for the new year, you should already be thinking about them in December.  The holiday time is crazy as it is, so waiting until the last few days to think about some serious changes you need to make in your financial life can lead to a rushed resolution.  Start planning early on and refine it as the month goes on.  Once January 1 rolls around, you’ll have had a lot of time to think about it and will be motivated to follow through.

Measure it:  This is usually the toughest part of a goal, and also the most crucial.  Most of us have heard of SMART goals.  This is the M.  If you can’t measure your progress, there really is no point in making the goal.  You have to know where you are starting if you ever want to get to your destination.  Luckily for you, most financial goals are measured in dollars so they can be measured pretty easily.  If one of your goals is to spend less money eating out, look at your past few months and average how much you spent on eating out.  Now you have a concrete number to compete against as you try to achieve your goal and decrease the amount you spend eating out in the next few months.

Be accountable:  Getting through a workout is a lot easier with a like minded buddy, and the same thing goes for achieving goals.  Find a spouse, friend, brother, sister or co-worker who has similar goals in mind and share with each other.  Make a plan to check in with each other periodically during the year to check up on each others progress.  The mere fact that you will be reporting to someone else other than yourself can be an extremely powerful motivator.

Wanna get even crazier?  Declare your goal on Facebook or Twitter.  Now you’ll have a bunch of people periodically asking you how you’re doing on your New year’s resolution.  You are pretty much forced to follow through or risk public humiliation.  There is a great post by Mr Money Mustache on the powerful effects of declaring your goal publicly.

Make it super specific:  Remember those SMART goals?  The S stands for specific.  This is very important with financial goals because you need to start specific in order to build anything worthwhile.  Instead of “start an emergency fund”, make it a very specific number.  If you currently don’t save anything at all in an emergency fund, it can be as small as you like.  Make a goal to save $20 a week, very attainable for most sane people.  That comes to about $80/month, which is almost $1000 by the end of the year.  That’s a heck of a lot more than zero.  Make it as specific as you can, and remember, you can always ramp it up later in the year if you’re reaching your number way too easily.

Following these guidelines when making your New Years resolutions can actually be a little scary.  If you make a goal early on that is really specific and measurable, and you tell the whole world about it, it means you have to answer to others including yourself.  It also means you will most likely achieve your goal, getting you more motivated to make more and more goals.  Achieving your dreams is nothing more than meeting one goal after another.  Happy New Year resolution making!