Really? Is it 2026 already? It feels like we were just saying “next year will be different”. And now…new calendars, new planners, and once more—new conversations about fixing our finances. 

If you’re feeling a mix of hope, pressure, and financial fatigue, especially moving out of the costly holiday season, you’re not alone. But before we rush into budgets, savings, and all things we’re “supposed” to do with our money this year, let’s take a time to slow down and breathe. This is not an article about extreme resets and resolutions, but rather about finding a calmer way to look at your finances that aligns with where you are now, rather than where you think you should be. 

Backed with studies, let’s go through several approaches to resetting finances using sustainable systems that support real-life financial planning (including imperfect, rock-bottom days).

Reflection Before Action

Before you change anything about your money this 2026, I’ve learned that it’s important to pause. 

No judgement.

Not trying to fix anything.

Just pause and evaluate. 

In the past new years, I usually jump straight into a clean slate list of goals, specifically saving more and spending less, or “be better” with money this year. In fact, I did not spend time evaluating holiday expenditures, as it tends to hurt me emotionally. “Okay, never mind. Forget about last year. Let’s restart.” Guess what, unsurprisingly, I kept falling back into the same pitfall every year. 

According to Harvard Business Review, a lasting behavior change requires awareness. In short, you cannot change a habit, whether good or bad, if you’re not paying attention to it (Gallo, 2023). Fidelity Investments (2026) specifically echoes this, stating that before setting goals for the new year, one must have to review where one is now. When we understand where our money has been going, we tend to create far more plans than we can maintain. 

Sit down, and then assess your financial situation first—your income, expenses, savings, debts, investments—all of them! And then from here, reflect on your habits and experiences that lead you to this current state. Was it good? Was it bad? Does it have to change? 

When we don’t understand our baseline, we often create unrealistic goals. Therefore, reflection is a necessary first step. Not optional! Emotionally, this matters more when we admit to ourselves that our current financial habits are bad, or that our status is in a mess. It’s okay. It’s okay to feel shame or burnout. We can’t undo any of our bad decisions, but we can definitely do something to avoid them in the future. By accepting our past and current states, our failures become insights.

Don’t Set Unrealistic Goals

For the past years, I thought that a financial reset meant a clean slate by cutting everything back dramatically and immediately by lowering spending, creating promises and pledges, and smaller figures that look pretty responsible on paper. But here’s what I learned the hard way: When our baseline is unrealistic, we are asking ourselves to live in a way that does not match real-life transactions. 

A 2022 study published in the Journal of Consumer Research reveals that people usually set budgets that are too optimistic. Even though they have access to the data of their past spending, they tend to cut their budget below what they realistically spend, believing they will somehow behave differently in the future. The results reveal that actual spending stays close to past habits and that new budget limits. And that people do not re-adjust the budget and keep setting the same low targets, turning this planning method into a cycle of perceived failure (Lukas & Howard, 2023). 

Immediately, I saw myself in this pattern. This doesn’t mean we completely lack discipline. It means we are human. We create numbers that feel aspirational, a state that we want to achieve, and then feel defeated when instances throw it all off. Rather than revising the budget, I abandoned the resolution right away and waited for another new year to replan with the same behavior. Sounds familiar?

Budgets should reflect our real behaviour, not the ideal behavior we cannot achieve. That number might not be impressive. But it should be honest. Once honesty replaces optimism, the pressure will not overcome progress. 

Systems Matter More Than Willpower

A 2020 large-scale study by Oscarsson et al. (2020) tracked thousands of people attempting to achieve their New Year’s resolution over the entire year. Findings revealed that initial motivation did not predict long-term success. Most of the participants were highly motivated at the start, but struggled and dropped off months later (like most of us do!). 

One clearest findings was that discipline or enthusiasm does not make a difference—structure and systems do. 

Participants who have SMART goals and have a form of ongoing support (check-ins, reminders, applications, systems) were significantly more likely to stick with their resolutions. In contrast, those who relied on willpower alone failed even though they genuinely cared about achieving the goals. 

Many of our financial plans are built on an unspoken assumption that our future selves would consistently have the energy, focus, and discipline to make the “right choice” every day. And remember, every day for the next 365 days, yep, sounds unrealistic. And when that does not happen, we blame ourselves, instead of the system. 

Let’s change the approach. A calm financial reset does not ask you to stay motivated all year. It assumes willpower will ebb. In the next section, I’ll share specific examples of simple personal finance systems that will give you an idea of how to reset your financial habits this year. 

Simple systems outperform complex ones

Before we talk about systems, let’s untangle and define three things that often get confused with each other:

• Motivation is emotional and fleeting. Usually it’s strongest at the beginning (especially moments like the New Year), but naturally ebbs and flows. It’s useful, but unreliable in maintaining change.
• Discipline is a skill. Over time, it can be practiced and strengthened with consistency. This helps you follow through even when motivation is low. However, stress, fatigue, decision overload, and complexity make it susceptible to failure. 
• Systems exist to protect discipline. When motivation fades and discipline is tired, good systems reduce the amount of effort it takes to keep going and achieve your goals. 

Once I understood this distinction, it became clear why so many financial plans I did in the past never lasted. Even though I have systems in place, complex ones quietly assume I have all the discipline it takes to keep them in place. More categories. More rules. More tracking. More moments of evaluation and contemplation. In the end, they exhaust me instead of helping.

James Clear makes this point repeatedly in his infamous book Atomic Habits. He discussed that habits succeed or fail based on friction. The more effort a system requires, the more discipline it tends to consume. Mind you, even strong discipline wears down a strong spirit when asked to perform consistently at different seasons of life. 

Therefore, simple systems behave differently—they reduce friction and limit how often you need to decide. Below are some of the simple financial systems grounded in the principles of the Atomic Habits:

Make the Habit Obvious

One great enemy of habit formation is forgetfulness. When a habit is obvious, it does take a lot of mental energy to remember. 

Examples:

• Your banking or tracking app appears on your phone’s home screen
• A weekly “money check-in” is scheduled in your calendar
• Check-in reminders are tied to existing routines (e.g., before going for a walk on Sunday)

Make it Easy

Every additional step in place can break a habit. James Clear emphasizes that habits tend to stick when the barriers to doing the action are low. So when saving or tracking is done automatically, consistency does not really matter on your end. 

Examples:

• Bills set to auto-pay
• Using budget apps to list down daily expenses with notifications
• Automatic savings transfers

Design the Environment

When your environment nudges you towards better choices, it’s easier for you to practice discipline. Conversely, if your environment encourages you to spend really badly, you probably need to assess and restructure. 

Examples:

• Remove saved cards from your shopping apps
• Keeping your savings out of immediate reach or access
• Set spending limits on your cards or budgeting apps

Make Progress Visible

As we all know, results take time. As per Clear, one should reward consistency and not outcomes. Making your progress visible does not mean obsessing over numbers, but creating a feedback that rewards showing up, returning, and staying engaged. 

Examples:

• “I did my weekly check-in. I deserve a coffee.”
• A simple chart that shows bills paid on time, cash buffer intact, etc. 
• Simple checkbox yes/no on “Did I check in with my money this week?”

Many of the system-based ideas in this article are inspired by Atomic Habits by James Clear. If you want a deeper dive into habit design, you can find the book here. 

Consistency Beats Perfection

A 2022 methods paper explains that real habit formation depends on continued repetition. It highlights that missing days do not erase progress, but what matters is whether the behavior resumes and continues. Stopping completely breaks the habit, not perfection (Gardner et al., 2022). 

This just affirms that consistency quietly outperforms perfection. And for me, consistency is not just about never slipping, it’s about not quitting. When your personal finance system is established to tolerate bad days, imperfect weeks, and fluctuating energy levels, then returning would be easy. 

Additionally, another peer-reviewed research published in Self and Identity found that people who respond to setbacks with fewer self-criticisms are significantly more likely to return to their system of achieving goals instead of loathing and abandoning altogether. With harsh self-judgement, these people tend to drop out and increase avoidance (Terry & Leary, 2011).

That is why calm and simple systems work. They do not punish our setbacks for being human. These systems expect disruptions and make a welcoming space for re-entry. Again, a gentle financial reset isn’t about doing everything right, but staying in the process long enough for change to accumulate and create real progress. 

A Gentle Way Forward

If this year feels like a fresh start rather than a continuation. That’s okay. Sometimes, moving forward simply means choosing something that lasts and allows progress to be slow, quiet, but consistent and effective. 

Like you, I’m resetting too. Hopefully, we’ll stick with it together all the way to the end this year. 

If you’d like more personal finance thoughts, gentle systems, and practical guidance along the way. You can subscribe to my email list here. I’d love to have you!

That’s all for now, gentle hustlers.

Cheering for you,

-Bryan

References

Lukas, M. F., & Howard, R. C. “. (2022). The influence of budgets on consumer spending. Journal of Consumer Research, 49(5), 697–720. https://doi.org/10.1093/jcr/ucac024 

Oscarsson, M., Carlbring, P., Andersson, G., & Rozental, A. (2020). A large-scale experiment on New Year’s resolutions: Approach-oriented goals are more successful than avoidance-oriented goals. PLoS ONE, 15(12), e0234097. https://doi.org/10.1371/journal.pone.0234097 

Gardner, B., Rebar, A. L., & Lally, P. (2022). How does habit form? Guidelines for tracking real-world habit formation. Cogent Psychology, 9(1). https://doi.org/10.1080/23311908.2022.2041277 

Terry, M. L., & Leary, M. R. (2011). Self-compassion, self-regulation, and health. Self and Identity, 10(3), 352–362. https://doi.org/10.1080/15298868.2011.558404

Gallo, A. (2023, October 4). Changing a behavior takes deliberate effort. Harvard Business Review. https://hbr.org/tip/2023/10/changing-a-behavior-takes-deliberate-effort 

Fidelity Viewpoints. (2025, December 18). 5 steps to power up your finances. https://www.fidelity.com/learning-center/personal-finance/create-a-financial-plan