goal setting

Financial goal setting can be a daunting task. Especially when you aren’t sure how to think about money. But when you decide it’s time to take control of your finances… and gasp… start thinking about a budget… goal setting is a key part of the process.

 

Even before you have taken stock of where you are at financially, you have most likely had a few dreams of where you’d like to go. If you haven’t thought about a few goals, now is the time to start thinking about them.


Big Picture Goals

Here are some examples of BIG PICTURE GOALS:

  • Paying off the credit card debt you racked up buying socks for all your family members (who really didn’t need another pair of socks) or that ugly sweater for the company holiday party
  • Saving up a few dollars to buy that really cool gadget you wanted but didn’t get for the holidays
  • Saving up for a vacation… because the holidays really wore you out and you just need to get out of town
  • Saving up to pay for those car repairs that inevitably could dampen your holiday spirit next year
  • Starting to build that rainy-day fund… because everyone and their dogs know you don’t really care for your boss and you’d like to someday be able to say f$%# you to them and walk out
  • You met a really hot girl or guy at the Christmas party… and you want to start saving up for a security deposit on that really big apartment you are going to rent together

key questions

The key to goal setting is think about where you’d like to go. The following questions will help – for each, take some time and jot down your responses:

  • What are some of the things in life that would make you really happy to accomplish in the next year?
  • What are those things you really want to accomplish in life over the next three to five years? Why do you keep putting them off? What are the things that stop you?
  • How much money would you need to save to accomplish these things? Take a few minutes and “price out” your goals. This will help you start to prioritize what you can accomplish above and beyond your core budget.
  • What are the things that really stress you out with money? Why do they stress you out?
  • Do you have a good sense of what your ongoing expenses look like? Knowing this will help you when you start thinking about goals, and help you start working on a plan on how to accomplish those goals.
  • Do you have a rainy-day fund for those annoying things that pop up?
  • Do you have a savings account set up for those things that you’d really like to do in the future?

Don’t make your initial goal setting process too complicated. If you have too many goals on it can quickly become overwhelming, and your likelihood of sticking with it drops rapidly.

 

The best advice we can give you is simply to start setting goals, and then developing a plan to execute your goals. If you don’t start somewhere, you’ll never get to the destination.