Writing SMART Goals to Improve Your Finances

For many of us, putting together a list of wishes, hopes and dreams, or even a list of desired changes, money issues appear near the top.

We want:

• a better relationship with money
• to save more and/or invest more
• to know where our money goes
• to feel like we’re in control of our spending instead of having our money just float away during the regular course of daily life
• to increase our income, often by a significant amount
• to decrease or eliminate debt
• to have a splurge fund
• to be ready for emergencies and unexpected expenses so they don’t cause a crisis in the moment

and often much more!

Writing SMART Goals is one way to turn these financial dreams into realities in your life.

Here’s how.

Step 1: Choose 2 or 3 Initial Priorities

Much as you might wish it were otherwise the only thing you’ll gain by attacking all of these goals at one time is frustration.

Begin the process of writing SMART Goals about these financial issues by focusing in on your top 2 or 3 objectives.

For this step don’t worry about the specific SMART criteria.

Just create a list of what money issues you’d like to work on and then circle the top 2 or 3. You’ll focus your SMART Goal writing on these.

Step 2: Begin Drafting

Begin writing your SMART Goals by restating the top priorities you picked in step one in the SMART format.

Write each goal as a SMART Goal so that it is Specific, Measurable, Attainable, Realistic and Time Limited.

For example, perhaps you have chosen “increasing income” as one of your financial goals. What can you say for each element of the SMART goal formula?

Specific: How much do you want to increase your income? For purposes of discussion let’s say you want to increase your income by 50%.

Measurable: The amount you want to increase is measurable since you’ve stated it as a percentage of your existing income.

Attainable: It is certainly possible to increase your income by 50% if you are creative.

Realistic: Here it is necessary to look at context. No one increases their income by that much without either significant extra effort in a flexible earning environment, or taking other creative steps such as adding on other sources of income. Are you in a position to do that or something similar as you’re writing this SMART goal? If not, you may want to reconsider your specific target.

Time Limited: By when will you achieve this increase? Here again your context is key. A 50% increase in a year may be do-able. A 50% increase in one quarter might be miraculous unless you are in sales and newly assigned to a hugely profitable territory with little or no competition. Judge the time limit you want to set from the context in place as you’re writing your SMART Goal.

The task of writing a SMART Goal changes your goal from “I want to increase my income” to “I want to increase my income by 50% over the next 18 months.”

Step 3: Draft Your Other Two Top Priorities as SMART Goals

Repeat the process of writing SMART Goals for the other priority (or at most two priorities) that you chose to focus on first.

Again, you’ll make sure all the SMART criteria apply to each goal in it is final form.

Step 4:Create An Action Plan for the Next Four Weeks

Once your goals are in SMART Goal format combine them into one Action Plan that assumes you’ll take some action on each goal each week for the next four weeks. Need more information on creating an action plan? Click here.

Notice that because you’ve spelled out what you want to accomplish by when your Action Plan practically writes itself.

Step 5: Track Your Progress

After you’re written your goals and created an Action Plan take action and track your progress for a month.

You will notice something immediately.

You may find it smooth going or perhaps hit a bump in the road.

You may feel you’re on the path to success or perhaps that modifications to what want to achieve or what you want to do to get there are needed.

This change is what writing SMART Goals to improve your finances feels like.

Savor it.

Keep working.

As you make progress, keep writing SMART Goals about your other financial objectives – and working on them -- so you can truly improve your whole financial situation over time.

Return from Writing SMART Goals to Setting and Achieving Goals Home.