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Are you ready to get serious about your personal finance situation this year? Whether you want to get out of credit card debt or simply improve your financial health, the beginning of the year is a great time to make financial resolutions and think about your long-term goals. Think outside of the box when setting New Year’s resolutions this year and set money goals this year (and every year after this).
Follow these tips for setting financial goals and you’ll be on your way to saving more money this year than ever before!
RELATED POST: Top 20 New Year’s Resolutions to Save You Money
Why Set Financial Goals for the New Year?
Setting financial goals is one of the best ways to start your year. Think of it as dreaming about a better life, but also knowing how to keep your priorities straight in order to meet your goals towards a more sustainable financial situation.
It’s important to sit down and set financial goals each year even if you have so much money that you don’t know what to do with it! Why? Because it’s a great way to budget for your year. A budget tells your money what to do, without it you are spending blindly. It also helps you stay focused on financial priorities and spending your money in alignment with your values.
RELATED POST:How to Save Money with Value Based Spending
Don’t know how to budget?Read this post to get started.
You can also check out my favorite way to budget with azero-based budget.
Your financial goal can be as small as saving $500 in an emergency fund by the end of the year or as big as saving up cash to pay for a house. Either way, setting a financial goal will help you figure out how to save and spend your money more wisely so that it works to your advantage.
Are Financial Goals the Same Things as Financial Priorities?
By definition, goals and priorities are not the same thing.
A goal is something that you want to accomplish while a priority is something that must be managed to accomplish a goal.
When it comes to financial goals and priorities for the new year, it’s okay to lump them together. If your goal is to save money for a down payment on a house, the priority might be to spend less on dining out in order to meet your goal.
It’s important to think of both goals and priorities.
Make Your Financial Goals More Than a New Year’s Resolution
Resolutions can be so much more than losing weight and eating better.
Saving money and making good financial decisions should always be on your New Year’s resolution list no matter how financially savvy you are. If you set good financial goals it can be so much more than a New Year’s resolution. Setting an achievable savings goals will allow you to envision how you want to spend or save your money. Whether you are tucking away money for retirement savings or a new car for an additional driver in your house, setting financials New Year’s resolutions if sure to help you achieve your goals.
Saving money can be pretty easy if you plan for it and have healthy money management tools.
That’s right, you actually have to plan to save money. Otherwise you’ll probably end up spending your money each month instead of saving it! Once again, this is where budgeting and paying attention to your spending habits comes in handy!
How to Set Financial Goals
In order to get your priorities straight when setting financial goals, I suggest making a list of 3-5 financial goals. Use this printable to help you brainstorm. Download thePDF version here.
Steps for setting new financial goals:
1. Jot down three financial goals
It doesn’t matter if you have short-term goals or long-term goals, just write them down!
For example, this is what I wrote down two years ago and I’m happy to report that we accomplished all of these goals!
- Continue to pay off education debt
- Contribute to college funds for the boys
- Save up towards a van
2. Take some time to think about your money saving goals
Keep the sheet somewhere you can see it and add to it as you think of new goals. I may come up with more goals or get rid of a goal. When I did this exercise in 2015, I added the following:
- Set up our will
- Save for a vacation
3. Make SMART goals
Finally, reformat your priorities to make them specific goals, but still attainable.
It’s always good to follow the SMART method when goal setting. Follow the SMART acronym:
- S- specific
- M- measurable
- A- attainable
- R- results focus
- T- time bound
Having a deadline for them is the easy part since you want to accomplish all of this by the end of the year. Mine ended up looking like this:
- Wipe out the remainder of Tom’s student loans by the end of 2016 (which we finally did- read about it here).
- Contribute at least $600 for each boy’s education this year (update for 2023- we now contribute much more than $600 a year to their education)
- Save up at least half of what is needed for a used van, so we only have to finance half of it.
- Set up our will by end of January
- Save $700for a Disney tripin April
Every year, I get super excited about our financial priorities because I love checking off stuff from my list.
Need a New Year’s resolutions worksheet? I’ve got that too!
Download it here:New Year’s Resolutions
- Come up with a list of 3-5 financial goals
- Think it over, expand on them, or take them away.
- Turn them into specific, attainable goals with a deadline if possible
Here’s a recap on how to set sending priorities for the New Year
- Come up with a list of 3-5 financial goals
- Think it over, expand on them, or take them away.
- Turn them into specific, attainable goals with a deadline if possible
The start of the new year is the perfect time to celebrate financial milestones and take a look at your household finances
Did you do a lot of unnecessary spending last year? Or did you have some major expenses you weren’t prepared for? Now is the time to look back through your finances from the previous year and make sure your new monthly expenses are heading in the right direction.
Truly, it doesn’t matter if you are saving for retirement contributions or just hoping to improve your financial literacy, now (whether it is the new year or middle of the year) is always the best time to explore different ways to achieve your goal of financial stability.
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