A new year often brings with it the promise of a fresh start, and as 2024 approaches, there is no better time to begin a journey towards great financial wellbeing. Setting clear financial goals is not just a resolution; it’s a commitment to your own prosperity. In this blog, we’ll dive into the art of goal setting by exploring three key aspects that are crucial to your financial success in 2024: defining your objectives, creating a realistic roadmap, and staying motivated along the way. As we step into the coming year, let’s ensure that our financial resolutions are not mere wishes, but well-structured, actionable plans for a more secure and prosperous future.
Defining Your Objectives
Start by writing out your financial goals, including those you are already working on and those you haven’t started yet. Once you identify each goal, organize your goals from most important to least important. Make sure to put specific details about each goal (timeline, amount of money you’ll need, and how much you’ve already saved, etc.).
Now that you have your goals defined, separate them into two categories, short-term goals and long-term goals. Short-term goals may include taking a vacation or buying a new home. Whereas long-term goals are things such as retirement, paying for a child’s college education, or giving to charitable causes. Keep in mind that it’s possible to save for more than one goal, especially if you mix short-term and long-term goals. For example, it’s okay to save for a vacation and also contribute to your retirement.
Priorities differ from person to person. Make sure when defining your financial goals, that you pick the goals that are right for you.
Creating a Realistic Roadmap
Once you know your objectives, then it’s time to create the steps that will help you get there. When choosing which steps to take, it is important to make sure they’re attainable. Remember, these savings steps can’t interfere with your set monthly expenses, such as bills, gas, etc.
Let’s at one example:
Goal: Save $1,000 for a trip.
Timeline: 8 months
- In order to meet this goal, I’ll need to save $125 each month for the next eight months.
- Assess your current monthly disposable income that can be reallocated to your savings goals.
- If it’s less than $125, you will need to either adjust your timeline, or adjust your spending.
- Look for ways to save on variable things like groceries, entertainment, eating out, etc.
- Be sure to do a regular check in every few months to ensure you’re staying on target to reach your goal. Make adjustments as needed.
Your goal will likely require some sacrifices, but remember, it needs to be a plan that you can reasonably stick to.
Staying Motivated Along the Way
Tying your financial goals to specific motivations makes them more meaningful. As you review your goals, reflect on the purpose behind each one. What is your underlying motivation for it? Who is the goal going to benefit?
“Understanding your ‘why’ helps you become more committed and understand how the goal is associated with other goals” says Sarah Darr, head of Financial Planning for U.S. Bank.
Make sure to continuously reevaluate your goals. Life changes and other factors can affect your financial goals. It’s important to review your goals at least once a year to adjust expectations, chart your progress and review your priorities.
As we prepare to enter 2024, let’s remember the advice of Sarah Darr: “Your financial goals are an ongoing process that provides clarity and confidence for the future. You’re building a vision for the things you’re dreaming about and want to accomplish.” This wisdom is the foundation for our journey in setting clear financial goals.
We’ve explored the importance of defining your objectives, creating a realistic roadmap, staying motivated, and recognizing that this is not a one-time resolution but a continuous commitment to financial well-being. With each step you take towards your aspirations, you’re not just creating a budget or stashing away savings, you’re building a brighter future, full of promise and fulfillment. 2024 awaits, and it’s the year you’ll bring those dreams to life, one goal at a time.