How to achieve your New Year resolutions

Another New Year. Another resolution. What should it be this time? I went on the BBC's Woman's Hour last week to discuss this very question. The other guest on the programme said that she didn't fancy resolutions much. She didn't like the "oppressive" notions of "obligation and duty" that they come wrapped in.

I'm not so sure. I rather think we could all do with a little more in the way of notions of obligations and duty. That's particularly the case when it comes to our finances which is why, when the other guest suggested everyone resolve to eat better chocolate in 2012, I suggested we all make a proper financial life plan instead.

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But taking it further and making a financial life plan with a series of targets is the best way to go. Most of us neglect the management of our money. We get it, we spend it, we save it and we invest it. But we don't do so to a set plan. We don't sit down, decide realistically where we want (or need) to be financially and then work to get there. The results are obvious.

So here is what I would do. Sit down and work out where you are financially. How much do you earn? How much do you spend? How much are your assets worth? How much do you save? Then approach it from the other side. Which of those bits do you want to change and which can you change?

Look at the big picture and then set clear targets that might change that picture and that you have a real chance of meeting. The short-term ones might include finding higher-paid work by a set time, or just working harder to protect the employment income that you have; specific monthly debt-slashing or saving goals; running through all your bank statements properlyso you really know how much you spend and on what; or simply cutting up every credit card in sight.

Longer-term goals might involve regular overpaying on your mortgage so you own your house by a set date; or setting up and contributing to a pension with a view to hitting an ambitious retirement income. Finally, once you've made a plan, keep reviewing it. Look at where you are with your partner every six months; check your progress against your targets; and make new ones if you are ready to do so. Begin with the end in mind and you might get the end you want.