One of the things that used to trip me up about setting financial goals is that I would set so many of them. I was going to pay off my credit cards, max out my retirement accounts, and save up for a down payment. All in one fantastic year that would fix all my financial problems. Of course, by February I would be discouraged and disappointed. I wasn’t getting anywhere. Finally, I realized that if I wanted to find financial success, I needed to tackle one problem at a time. I couldn’t expect to fix five years of messing up financially in just one year. At least not without doing things I was not willing to do.
Instead, I started focusing on one or two financial goals for the year — especially if they were big goals. It makes more sense to narrow down your goals if you are planning on trying to do something big. By focusing on one aspect of your finances you can concentrate your efforts, make more progress, and increase your chances of success.
Just as multi-tasking can actually slow you down overall, having too many goals can weigh you down and reduce your chances of success.
One of the best things you can do is figure out what’s most important to you right now, as far as your finances are concerned.
No matter your New Year’s goals, it’s possible to narrow down what you really want to accomplish. Think about your priorities, and figure out what you most want to take care of in the coming year. If you have a partner, discuss it as a family. Decide what you will work on together to set up for a better financial future.
In order to increase your chances of success achieving a goal, you need to include specifics. This is important if you want to have a way to measure your success. As you move to meet your goal, you need to list out everything that needs to happen to make that goal a reality.
Think through the steps that lead to your end result. Your larger goal will actually be made up of smaller mini-goals if you want to find success. Indeed, once you start thinking about all of the smaller things you will need to do in order to achieve the larger result, you will find that it becomes necessary to narrow down your goals. Think about how much work each of your goals will be to accomplish, and then jettison some of them from your list.
Another thing you can do is consider alternate goals. What happens if you are able to accomplish something sooner than you expected? Come up with one or two additional goals that you can start working on during the year if you hit your target. One of the reasons we set goals is so that we can keep improving. Your finances can always get better, so it makes sense to have a couple more things to work on later.
How do you set financial goals for a New Year?
Photo by stuartpilbrow.
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I'm just an average mom, trying to live a frugal life and get out of debt. I write about things that have (and haven't) worked to improve my family's financial situation. What works for me may or may not work for you, and you should always consult a financial advisor before making important financial decisions.
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