financial goals

How to Set Financial Goals (And Keep Them!)

Do you have trouble reaching your financial goals?

If so, you’re not alone. According to researchers from the University of Scranton, 92% of people that set New Year’s goals won’t keep them.

Financial goals are tricky when you factor in potential fluctuations that might loom ahead. Everyone experiences varying levels of financial uncertainty in some areas of their lives, such as employment, medical care, and the impact of the economy.

If you struggle with money management or goal-setting already, you might be tempted to consider this as an excuse to abandon self-imposed expectations altogether.

While this would prevent you from failing (after all, how can you fail if you don’t even try?), it could also hinder any progress that you might make.

Instead, how about trying these foolproof suggestions for setting and keeping your financial goals?

Read on to learn how you can make New Year’s resolutions that you’ll stick to in 2018!

Your Guide to Achieving Financial Goals

If you haven’t had much luck reaching your goals in the past, it could be that your goals were to blame.

Goal setting plays an important part in determining your overall long-term success.

Want to join ranks of the 8% of people who actually stick to their New Year’s resolutions? Start with these tips.

Tips for Setting Goals You’ll Keep

1. Be Specific

When identifying your goals, you need to define them as specifically as possible.

For example, instead of “save money”, you make a specific plan for how much money, what it is to be used for, and where the money will go. So, your goal might be identified as “save $5,000 dollars toward’s Mary’s college fund”, if you wanted to save money for your daughter’s college. Or, if you were saving for retirement, it may be:”save $2500 dollars for my 401-K fund”.

You might have more than one area designated for funds.

You could also be even more specific and set monthly goals, or increments according to when you are paid. Then your goal might be: “save $210 dollars per month for my 401-K fund”.

The more detailed your goal, the easier it will be to measure your progress towards fulfillment.

2. Challenge Yourself

Researchers Edwin Locke and Gary Latham found that those who set specific and challenging goals have higher performance levels 90% of the time.

You want your goal to be far enough out of reach that it presents a challenge, but not so difficult that it’s unattainable, or otherwise discouraging. If you decide that it will be impossible to complete, then you are more likely to give up along the way.

It may help to break it up into smaller parts and to reward yourself each time you reach a milestone.

For example, your ultimate goal may be to save money to purchase a car next year. For each month that you save consistently and make progress, you might treat yourself to a small reward, or set aside a certain amount for an indulgence, such as dinner at your favorite restaurant or a round of golf with friends.

You will feel a sense of accomplishment as you meet each milestone, offering spurts of encouragement as you forge ahead. If you have not typically been able to maintain a consistent pattern of long-term self-discipline, then this is highly recommended.

3. Write it Down

As you determine what your specific financial goals will be, write each one down in a notebook. Write them in a notebook that will only be used to record information pertaining to only your financial goals.

Create one list of short-term goals (6 months to one year; or less) and one for long-term goals. Then, you can easily refer to your notebook at any time to remind yourself of your goals and keep up with how far you have come towards meeting them.

Writing also helps to create a lasting impression in the mind, so you are less likely to forget what you have written.

4. Set Realistic Expectations

When you are setting your financial goals, one way to be sure that you will fail is if your expectations are impossible to achieve. For example, if you make $40,000 dollars per year, and your basic living expenses take up $30,000 of that amount, it would be unreasonable to set a goal to save $15,000 dollars.

What’s Next?

After you have clearly outlined your goals, laid out benchmarks and specific amounts and timelines, then it’s time to start practicing making progress.

The first part of achievement is goal-setting, which primarily involves thinking skills. But the next part of your success is defined by action.

Ready, Set, Action

Here are some things that you can do to make your goals easier to achieve.

1. Automatic Savings

If your financial goals are geared towards saving money, there are several modern-day options that will help you be successful. To make saving as easy as possible, make it automatic.

You can open a savings account that receives a certain amount each time a paycheck is deposited into your checking account. You never see the money in your account, so it is much less tempting to spend, and you may not even think about it very often.

In today’s world of technology, there are also apps that make saving money a breeze.

And, there is the option of opening an online piggy bank that helps you to save money to allocate towards various sources.

Smartypig is one of the free online savings programs in partnership with Sallie Mae, where anyone can set up an account and get to saving.

2. Techno Tools

In addition to an online piggy bank to help you save, there are several other online tools and apps to help with financial goals. You can keep track of spending, budget your income, set up online or mobile bill payments and more.

Check with your bank to find out if they offer any special online services for customers.

Level Money is a great app that can keep you up to date on your balance, alert you of spending and let you know how much spending allowance you have left.

3. Add it Up

You might want to check out an at-home financial planning software program or check out some that are available for download online.

A computer program is helpful in keeping up with all of your bills, a current budget, savings goals, as well as other pertinent information. Plus, all of your financial records and info is kept in one place and is easily accessible at any time that you need it.

This is much easier than keeping paper files for everything for most people.

However you choose to do it, you should have a file or program with a budget, as well as bills, payments, goals, stock information, savings funds, including retirement, and all other financial data recorded.

Strategies for Progress

As you work towards your financial goals, it can help to have strategies in place to keep you from veering off track.

These are some ideas that might help you to keep your goals in check:

  • Have an Accountability Partner

Choose someone that you trust and make a monthly date to touch base and report how you are coming along.

It can help to motivate us if we know we are sharing our progress with someone else. Plus, they may be able to offer advice or share insight on habits that you may not see.

  • If You Mess Up, Get Back on Track

Perhaps you overspend one month. Or, you don’t save what you planned. Or, maybe a car repair or a household emergency came up that threw you off course.

If, or when, this happens, don’t beat yourself up. But, don’t quit your plan, either. One month of mismanaged funds isn’t near as damaging as it would be if you spent the next six or ten months doing the same thing.

Just pick yourself back up and start again as soon as possible. And remember, as long as you are making progress, you are doing great.

  • Don’t Fall for Money-Saving Myths

Be on guard for wasteful spending habits and sneaky tactics that get you to spend more than you had intended.

Sometimes, we might buy an extra item just to get a special “buy one, get one free” deal. Or we might order more off a site just to qualify for free shipping.

We trick ourselves into believing we are saving money, even though we would not have spent the money we use to get the “deal”. Because of the so-called “deal”, we end up throwing our budget off balance.

Just buy the items you need and don’t get lured into retailer’s tricks to make you spend more.

Get More for Your Money

Financial success is about getting your money’s worth, and getting the most you can out of your finances, and your life.

Want to find out more ways to get financially healthy this year?

Check out our blog for ways that you can save on everyday items!