Make 2022 the year you take control of your finances. Setting financial goals creates a roadmap for both short-term and long-term planning, allowing you to establish good financial habits and a strong foundation for future success. Take some time to think about where you see yourself in the months and years ahead, and set up financial goals now to help you get one step closer. Here are a few steps to help you get started:
- What is your goal? Think about what is meaningful and important to you. Are you looking to pay off student loan debt or create a budget? Or are you ready to save for a new home or start a business? This should be personal to you. It is okay to set multiple goals, but don’t go overboard or it will be much more difficult to meet these goals. Once you’ve narrowed down your goal, make sure to put it in writing where you’ll frequently see it.
- What is your current financial situation? Your goal should be realistic for you. Avoid extreme plans that may not be feasible. Review your existing finances to determine what is reasonable and available to save. How much do you have to work with each month? There may be places you can adjust your spending to save more, but make sure your goals are doable to ensure success. From there, you can set a specific financial goal, like paying off a certain amount of debt each month or putting away a specific amount in savings.
- When is your target date? Set a deadline for yourself to complete the goal, and then lay out steps or milestones to hit along the way. This will make it attainable, and you can celebrate small successes along the way. If you set multiple goals, think about whether they are short-, mid-, or long-term goals and plan accordingly. Also make sure to prioritize these goals; what will you fund first when you have funds available? Lastly, think about whether you can increase your contributions to your goal over time. Perhaps this month you set aside 5% of your paycheck toward your goal, but maybe you can increase it to 6% next month.
- Keep the goal in mind. Setting up financial goals can help keep you focused. Ask yourself before buying something–do you truly need that latte/coat/video game/etc.? Or can that money help you meet your goal faster?
- Expect the unexpected. Don’t be discouraged when setbacks happen. Whether it’s changes in your income or a surprise expense you hadn’t planned on, you may not be able to meet your goals each and every month. But you’ll be continuing to make positive progress, and over time, you will get there.
Spend less, save more. Sounds easy, right? We all know that in reality this is not always the case. But that doesn’t mean it’s impossible to achieve your financial goals. Check out these additional tips to help make your goals a reality: