Spring is here, and there’s no better time for a fresh start. This isn’t just the time to break out the shorts, flips-flops and start the spring cleaning, it’s time to get your finances back in shape. If things like getting out of debt, saving up to buy your first home and paying off student loans are on your list of financial to-do’s, you need to have a game plan. This starts with goal-setting. According to a study by Fidelity, only 37 percent of Americans set financial goals. So how can you join those ranks?
It may sound difficult, but we promise, you can do it. Setting tangible and realistic financial goals, following them and tracking your progress are keys to success. If you’re not sure where to start on your financial journey, we’ve got the first steps right here to help you achieve your dreams.
Know where you stand. Before you can set any money goals, you need to know and be honest about where you currently stand. It can be scary to evaluate how much debt you have or take a hard look at how much you aren’t saving, but this is the first step to setting an attainable financial goal.
Be SMART. The acronym SMART, which stands for specific, measurable, attainable, relevant and time-limited, has been used for more than 20 years to help people set and meet goals. Use these criteria to help you set not only a specific goal but one that is reasonable for you to achieve. Also, don’t get discouraged! Paying down debt, saving for that first house or building up that retirement account takes time and patience.
[See: How to Live on $13,000 a Year.]
Budget brilliantly. This doesn’t mean sacrifice, but it does mean being smart about your money. You might have to get creative with how and where you spend to help you reach your goals. A good starting place is to take a look at your discretionary spending. Dining out, entertainment and clothing are easy spending categories to cut back on. If you can’t resist the temptation to spend, at least look for good bargains to help you cut corners.
Goldilocks your goals. Dream too small and you may find you’re not making much headway. Dream too big and you may get frustrated and give up. Establish goals that feel like a stretch but can be achieved with dedication and hard work. Start small with the goal of paying off one credit card and then tackle something a little bigger like climbing out of debt. Goals aren’t meant to inhibit or scare. They empower us and give us something to strive for, achieve and celebrate. We do this quite often with questions like “Where do you see yourself in 5 years?” Why not apply this thinking to your finances?
[See: 12 Habits to Help You Take Control of Your Credit.]
Keep your eyes on the prize. Don’t just think about your financial goals. Visualize them. Write them down. You may want to include specific details about how much money it will take to reach that goal and the date you want to achieve it. Consider telling people you trust about your goals. Friends and family can help keep you accountable and support you every step of the way.
Goals change and grow, and they should! Your life is always changing, your goals should too. The fresh-out-of-college career seeker may have very different financial goals than the 30-something looking to settle down and start a family. Go with the flow! It’s OK to adjust your goals as your needs and life circumstances change.
It’s important to remember that goals aren’t achieved overnight. They take time. Goals also aren’t supposed to be tucked away in a junk drawer; keep them visible and make a date to revisit them at least once a week to keep you on track. Most importantly, don’t be scared to adjust your goals as needed or when circumstances change. And remember, when you achieve your goals, we’ll be cheering with you at the finish line!
[See: 11 Tips for Paying Off More Than $100,000 in Debt.]
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6 Ways to Spring Clean Your Financial Goals originally appeared on usnews.com
