Setting Smart Financial Goals

When taking control of your finances, it’s helpful to set financial goals to keep you on track and build your confidence—that is, as long as they’re achievable. A simple trick can help you develop goals that are a stretch, but won’t leave you feeling defeated.
Goals that are S.M.A.R.T.—specific, measurable, attainable, realistic and timely—lead to greater success.


Many people get off track because their goals are vague, such as, “I want to build an emergency fund” or “I want to pay down my credit card debt.” Using the S.M.A.R.T. system above, these non-concrete goals could become “I will put $50 from each paycheck into an emergency savings account for one year,” or “I will pay an additional $100 on my credit card bill each month until Christmas.”


Financial goals can be easier to measure than other goals because you’re able to check your progress via bank and credit card statements, or by viewing your accounts online. Charting the growth of your savings account or the decrease in your debt gives you a concrete way to see your efforts paying off. You can use your bank’s online banking features to help you track your progress whenever it’s convenient for you.

Attainable and Realistic

For your goals to be attainable and realistic, you’ll have to tailor them to your circumstances. If you make $40,000, a goal of saving $20,000 a year is unachievable. Working toward a more attainable goal—like paying off a certain amount of your student loans within a specific timeframe—will have a far more positive effect on you both financially and psychologically. Creating reasonable expectations will give you the willpower to stick to goals, even when they mean making some spending sacrifices. You can always set another, bigger goal once you achieve the first one!


It’s also important for goals to be timely. Long-term goals are great to have, but may seem so big or far off that it’s hard to get a handle on them. Focusing on short-term goals, those you can achieve in one year or less, will build your confidence as you develop good spending and saving habits.