Setting financial goals starts with something super simple but absolutely key: a financial plan. Without this first step, you're basically wandering around in the dark. If you've checked out any of our other tips, you’ll know we always recommend starting here. Why? Because it helps you get organized, make sense of your money, and create a budget. It’s like the GPS for your financial journey—no GPS, no clear direction.
Financial planning is all about figuring out where your money stands right now and getting it in order. Once you know that, you can set your goals and create a step-by-step plan to crush them.
Here’s the deal: you can have more than one financial goal at a time (multitasking, anyone?). And guess what? Research shows that people who plan their goals end up with 2.7 times more wealth than those who wing it.[1]
But remember, your plan should fit your life. Don’t compare yourself to someone with totally different income, expenses, or family dynamics. Keep it real and make it work for your situation!
Financial goals are the targets you aim for with your money. And good news: you don’t have to pick just one! Setting clear goals not only makes you more likely to achieve them but also comes with some great perks: you’ll feel more confident about your future, big goals (like saving for retirement or your kids’ college) will feel doable, and your savings and investments will align with what matters most to you. Plus, having a clear plan means less stress and more focus on what truly matters.
Okay, here’s the fun part: taking action! Here’s how you do it step by step:
Take a good, honest look at your current finances. How much do you make? Spend? Save? This is your baseline—it tells you where to start.
Make your goals Specific, Measurable, Achievable, Relevant, and Time-bound. Instead of saying, “I want to save money,” go for something like, “I’ll save $500 in the next three months for holiday gifts.”
Credit card debt or other high-interest loans can suck the life out of your budget. Pay these off first so you can focus on your goals without the stress.
Break down your income and expenses. Allocate enough for the basics, but don’t forget to set aside money for your goals—yes, even small amounts count!
Setting financial goals doesn’t have to be scary. Take it step by step, and don’t forget to celebrate your progress along the way (yes, treating yourself is allowed!). You’ve got this—your future self will thank you.