Current market environment performance of dynamic, risk-managed investment solutions.
By David Wismer
They say New Year’s resolutions are meant to be broken. By now, some readers of this article may already feel frustrated by their inability to follow through on some of their well-intentioned resolutions for 2025—if they made them at all.
According to research conducted by research firm YouGov:
• Only 31% of Americans plan to make New Year’s resolutions or set goals for 2025.
• 58% of adults under 30 plan to make resolutions, while only 24% of older Americans say they will do so. Just 14% of adults 65 and older say they intend to make resolutions.
The same research says the most common resolutions focus on saving more money (26%), improving physical health/exercising more (22%), being happier/improving mental health (22%/17%), eating healthier/losing weight (20%/17%), learning something new/reading more (15%), and improving relationships with friends or family (14%).
According to YouGov, confidence in keeping these goals isn’t very high. Only 40% of respondents say it is “very likely” they will keep their resolutions throughout the year.
Even this figure may be overly optimistic. Prior research shows that only about 25% of resolution-setters achieved at least some success in their efforts. And Gallup reports that by mid-February, “80% of the people who set New Year’s resolutions will have abandoned them”—a trend so common that it has earned its own unofficial observance on the second Friday of each January: “National Quitter’s Day.”
If you’ve set a resolution for 2025, good luck to you—though luck really has nothing to do with it!
Forget New Year’s resolutions: How about October reassessment?
Some people are rethinking the tradition of New Year’s resolutions, opting instead for goal setting in October. According to a 2024 article in The Wall Street Journal, a movement called “October Theory” is gaining traction, encouraging people to reflect and set goals during the final three months of the year.
The article highlights a couple of reasons why October is appropriate for self-reflection and goal setting:
• The changing seasons and start of the academic year inspire a sense of renewal.
• The year’s impending end creates urgency but leaves enough time for achieving some life changes or following through on aspirations from earlier in the year.
“This is a great time, 90 days from the new year, from the holidays, to reassess, see where you are with things,” adds Laurie Kramer, a licensed clinical psychologist and a professor of applied psychology at Northeastern University.
Setting achievable and continuous long-term goals for your investment portfolio
Rather than setting resolutions tied to a specific date—whether January 1, October, or your birthday—it makes much more sense to consider adopting a goals-based approach to your financial future. Breaking larger objectives into smaller milestones fosters a more sustainable and flexible framework than the “all or nothing” mentality of traditional resolutions.
In the interviews we have conducted for Proactive Advisor Magazine with successful financial advisers, the vast majority employ some version of goals-based financial and investment planning. One article on this topic combined adviser insights with a research-based perspective. Here is an edited excerpt:
“Goals-based investing has two meanings in today’s retirement planning environment:
“1. The practical notion that an investment plan should be based on achieving realistic goals customized to an individual’s (or couple’s) overall financial-planning requirements … —not some far less relevant market benchmark. … It starts with a financial plan that attempts to identify realistic levels of returns that will help a client meet their financial goals. …
“2. The philosophical idea that investment success should be measured on how it helps clients achieve the lifestyle goals they desire. Those goals could be the most basic, such as attaining a comfortable retirement. … Or, they could also be more ambitious, such as helping fund a grandchild’s college education, buying that [long-desired vacation home or condo], making a significant contribution to a favored charity, or going back to school to jump-start a new career. …
“By its very nature, a goals-based investment plan will not see returns anywhere near those of the best bull markets. But, importantly, it should also not suffer the worst drawdowns seen in severe bear markets. In general, the objectives of a goals-based investment plan are to smooth out volatility, achieve steadier returns, and project a range of returns for a client that is consistent with their risk profile and has a reasonably strong mathematical probability for success over time.”
FPI’s goals-based approach: OnTarget Investing
In defining its overall approach to investment management on behalf of financial advisers and their investor clients, Flexible Plan Investments (FPI) strongly endorses a goals-based investing approach—but takes it to a higher level with continuous evaluation.
FPI explains, “An investment portfolio should be tailored to the time lines, risk tolerance, and financial goals of the investor. The benchmark used to set investment expectations and track the progress of that portfolio should be just as customized.”
In 2007, FPI introduced OnTarget Investing to help investors and their financial advisers define realistic investment goals and set appropriate personalized benchmarks. FPI believes that setting and consistently articulating realistic goals is the key to helping investors stick to their financial and investment plan.
The process includes five key steps for each investor client, completed in consultation with their financial adviser:
FPI summarizes, “Investment markets are dynamic, requiring continuous assessment to assure your account is OnTarget to reaching your goals. Our process applies multiple management approaches to reduce market risk. …
“Evaluating progress is a crucial component of the OnTarget Investing process. The investor and financial adviser will regularly receive an OnTarget Progress Report that shows how the portfolio compares against the investor’s personal benchmark for success.”
A detailed explanation of how the OnTarget Progress Report helps each client visualize their portfolio’s progress over time can be found here.
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Setting and following through on “resolutions” every year may be a formidable task for most people. But FPI’s OnTarget Investing approach will likely make monitoring—and reaching—customized investing goals for the long term a far more positive and achievable outcome.