MONEY

Plan for your financial New Year’s resolutions to fail. In a good way.

This month, I’m highlighting a few good tips that got cut out of a column in the January/February issue of MONEY on “Making Resolutions Stick.” Here’s one idea:

The New Year is a little more than a week old — how are those resolutions coming?

If you’re like many people — 25%, according to one study — your vows to start fresh and do better will turn to dust within the first seven days.

But 2011 could hold the success you crave, if you understand the dynamics involved in making behavioral changes come true.

“There are no secrets to success. It is the result of preparation, hard work, and learning from failure.” — Colin Powell

According to scads of psychological research on behavioral change, the people who ultimately succeed are those who plan to fail.

Yes, “plan to fail” may sound self-defeating. But apparently it’s not. “Assume that fallibility is part of the process,” says John Norcross, professor of psychology at the University of Scranton and co-author of Changing for Good.

When you’re attempting to ditch a nasty old habit and replace it with a shiny new virtue — I will bump up my 401(k) contributions each quarter! I will fully fund my emergency account this year! — you’ll likely slip, procrastinate or tumble off the wagon several times before you achieve your desired result, say researchers.

This is particularly true of financial resolutions, adds Norcross.

“People tend to be vague about their financial resolutions,” he says. “They might say, ‘This year I’m getting my finances in order,’ but that’s like saying you want to get your health in order. You need specifics for your plan to work.”

“Try again. Fail. Fail better.” — Samuel Beckett

In fact, by anticipating — and responding positively — when you fall back into your old ways (such as procrastinating on your emergency fund), you and your money will realize some tangible gains:

  • When you pick yourself up, you’re less likely to feel discouraged by future failures — or daunted by life’s inevitable curve balls.
  • Learning persistence (and having faith in your good intentions) will help you achieve other goals.
  • And ultimately, says Norcross, who has studied hundreds of people’s New Year’s resolutions, pushing through failure typically leads to what you wanted all along: Success.

What are your financial resolutions this year? Become a smarter investor? Save more for retirement? Get out of debt? Something else? Let us know in the comments section below.

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