Financial Goals: Set Them and Slay Them!

Setting financial goals can seem daunting. It’s easy to say, “I want to be rich,” and then never do anything to get there. It’s a lot harder to say, “I want this specific amount of money because I want to be able to do this specific thing.”  

When you set a financial goal, you turn a dream or a wish into something actionable, which can be scary. But it doesn’t have to be. Financial goals can be empowering! They can give you focus, direction and help you take actionable steps towards achieving your overall life goals.

What is an Effective Financial Goal?

I may have accidentally given the baby away with the bathwater in the opening paragraph! Did you see it? The difference between an effective goal and a dream is that an effective goal is specific. “I want this specific amount of money.” It can be a million dollars to achieve financial freedom, or it can be five thousand dollars for an emergency account. It can also be a few thousand for a new computer or a trip somewhere!

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That leads us to the other component of an effective financial goal – the why. Why do you want to be rich? Why do you need a million dollars? If you don’t have a reason, then your goal won’t be effective. It’s just a dream. You think that being rich or even having a million dollars will make your life better. But how will it make your life better? What will you do with that much money? Did you calculate how much you need and come to that amount, or did you just pull it out of thin air because it’s a nice, round number?

I know that it’s fun to hope and dream, but if you don’t have a reason to set a specific goal, you are less likely to achieve it.

What is a Smart Financial Goal?

A smart financial goal is similar to any other type of smart goal. Setting smart goals is a specific way of thinking about your own personal goal setting to give you the absolute best chances of achieving them.

Smart goals are:






We talked at length about each of the components of a SMART goal in our post on goal setting, so I’m not going to rehash that here. However, it’s important to note that these five attributes should be applied to your financial goals as well. Setting goals that hit these components will give you a better chance of achieving your goals.

What Are Some Examples of Financial Goals?

Let’s look at an example of setting financial goals using the SMART method. Let’s say you need a new car. Your financial goal might be something like “save up enough money to buy a new car,” right? Is that a smart goal?


It doesn’t meet any of the benchmarks of being a smart goal. You have no idea how much money you need, no idea what kind of car you can afford, and no sense of how long it will take you to save the money. Because all of these aspects are missing, there’s no way to even tell if it’s realistic or not.

Let’s try again. “I want to save up fifty thousand dollars in six months to buy a brand-new sports car without credit.”

This goal is much better. You have a specific amount of money and type of car in mind, you have a timeframe established, and it’s measurable. You will know whether you achieved this goal in six months or not. Whether it meets the other two aspects of SMART goals, being realistic and achievable, is based on your personal situation.  Is it possible for you to save fifty thousand dollars in six months, given your current financial situation?

For the vast majority of us, this isn’t realistic.

One more time. “I want to save five thousand dollars and improve my credit score by 50 points in the next six months so that I can buy a reliable car.”

This goal meets all of the benchmarks of a SMART financial goal for most people. It’s specific, measurable, achievable, realistic, and there is a specific time frame.

What Financial Goals Should I Set?

The specific goals you set are going to be personal. Every person has different hopes and dreams and different reasons for setting financial goals. But we’re going to use the SMART template to give you some examples of what your goals should look like.

If you aren’t sure what you want out of life or how to get there, grab our free financial freedom mind map and worksheet. It’s four pages of mind maps, brainstorming sessions, and ideas designed specifically to help you identify and set financial goals.


Most people already have some goals in mind. Short-term goals might include paying off credit card debt or paying off student loan debt. They also might include budgeting, saving, or a plethora of other financial topics. Long-term goals might include saving for a financially secure retirement or building generational wealth for your children.

Financial goals don’t have to be limited to strictly monetary goals like saving, investing, or repaying. You may want to set more introspective goals, like examining your spending habits or deciding to move. Your financial goals may go hand in hand with your career goals – maybe you want to increase your income by switching industries or going after a promotion.  

A good way to start thinking about what your financial goals should be is to brainstorm your financial needs and wants. I’ve found it helpful to write these things in a journal. I write down things like short-term wants, immediate needs, my dream life scenario, and the obstacles that are in the way of me achieving that. This brainstorming session can help you identify what it is that you really want, and that can help you set realistic goals towards achieving it.

Financial Goals for Everyone

Even though everyone has different hopes and dreams, wants, and needs, a few financial goals are probably smart for everyone to pursue, especially when just starting in your financial journey.

Emergency Fund

Having a fully-funded emergency savings account is vital to achieving your financial goals. Emergencies can pop up at any time and destroy everything you were working on if you aren’t prepared for them.

The big question is, what does fully-funded mean? Some say that you need a thousand dollars, but the harsh truth is most emergencies that I’ve had cost at least that much, and some cost much more. A car repair will be at least five hundred. A new appliance will be more than that. Most services on the house (plumbing, electrical, etc.) cost a grand or more.

Now, if you don’t own a home or a car, maybe a thousand will be enough – but I recommend trying to save more than that. I think having an emergency fund of six months of living expenses is sufficient for most people. This will give people the money they need if there’s a few thousand-dollar emergencies and help pay the bills in the event of a sudden job loss.

Pay off Debt

Another goal that most people should have is getting out of debt – especially high-interest credit card debt. Those payments really are burdens that prevent you from living the life you want to live. Once you get the cards paid off – put them away! Try not to use them anymore unless you have no other options.

Financial Security

Financial security is a fundamental goal and often isn’t discussed much because it’s harder to turn into a SMART goal. Having financial security means that you can pay your bills and don’t have to worry. For many, it involves having a secure job and not living paycheck to paycheck.

What exactly it means to be financially secure is different for different people. You will have to decide for yourself what it means and then work to create your SMART goal towards achieving it.


The most important long-term goal that you should be thinking about is retirement. If all goes well, most of us hope to get to the point in our lives where we no longer have to work, where we can enjoy our golden years on the golf course and in the garden, with a big enough nest-egg to take care of all of our financial needs.

The truth is that all never goes well for anyone. Some are forced into retirement because they are unable to work. Others have to take care of their family. Saving for retirement is an important goal because you never know what will happen twenty, thirty, or fifty years down the line. It’s far better to be prepared than to be left destitute if you become too sick to work.

How Do I Achieve My Financial Goals?

Now that you have a good idea of what types of financial goals you should set, here comes the tricky part. It’s time to actually achieve those goals. Don’t worry – it’s not as difficult as it seems. There are plenty of actionable steps and goal-achieving systems you can use to help you on your journey.

Get in the Right Mindset

The first thing you need to do to achieve your goals is to get into the right mindset to achieve them. It sounds simple, but many people miss this important step. There are lots of ways for you to accomplish this. I like to use a journal. I write out all of my goals, dreams, and money mantras, and journal about what my life will be like once I achieve them.

Others who are more visual create vision boards or collages where they scrapbook their vision for their financial goals. Still others prefer to meditate and find that the physical action of deep breathing while focusing on their goals helps them achieve it.

There is no right or wrong way to get into the right mindset of achieving your goals. Try a few things and stick with what works best for you.

Create an Action Plan

Now that you have your mindset right, it’s time to make a plan. Part of that is making a specific financial plan, a worksheet containing your current situation, your long-term goals, and your strategies for achieving them. Our financial freedom mind map can help sort that out.

But your action plan should also include your short-term goals and steps you can take towards achieving them. Let’s take another look at the new car goal from above.

“I want to save five thousand dollars and improve my credit score by 50 points in the next six months so that I can buy a reliable car”

The goal is great; it includes all of the “whats” and “whys.” The action plan is where you figure out the “hows.” How are you going to achieve this? Are you going to save a certain amount of money out of each paycheck? Pick up a side job to earn the extra money? Pay off more debt to improve your credit score? There are numerous ways to achieve this goal. Your action plan is specific to what you can reasonably do to achieve it.

Break the Big Goals Up

Five thousand dollars in six months is overwhelming. That’s over $800 each month, which is also rather intimidating. However, it’s only about $200 per week. There are many side hustles that you can easily start, which will help you pocket two hundred bucks a week. You can drive for uber or doordash on the weekends, walk dogs after work, or sign up for TaskRabbit to help people complete chores around their homes.

You also might be able to pick up an extra shift or two at your regular job to help bridge the gap.

If you aren’t interested in picking up more work, you can probably save close to $200 a week by eating out less, reducing your costs at the grocery store, or exploring the numerous other ways you can save money.

The point is, finding a way to either save or make $200 per week is far less daunting than thinking about the full $800 per month. And if it’s not – you might realize that your goal of $5000 in six months isn’t realistic for you, and you will have to adjust your goal to something more attainable.

Use the Buddy System

A great way to achieve your goals is to get a friend involved to hold you accountable. Everyone in the fitness world uses an accountability buddy (accountabilibuddy!) to help them lose weight; why not take that idea over to the world of finance? The idea that discussing money is taboo is silly and should be abandoned anyway.

Your money accountabilibuddy should be someone with similar financial goals that will help you achieve yours. You can work together to save money by enjoying nights in together or calling each other before making an impulse purchase. You and your buddy can help each other stay on track, and you can reach your goals together.

Keep Track of Your Progress

Finding a way to keep track of your progress is a great way to help yourself achieve your goals. Many people draw little jars and fill them in until they reach their goals, and others have little trackers that they move every time they get a win. Other people prefer to record their progress in a journal or keep a checklist. There’s no wrong way to keep track, but having a system that works and helps you feel proud of your steps along the way will help motivate you to keep up with what you are doing.

Have an Award System

A final great way to help yourself achieve your financial goals is to implement an award system. Sure, the big payoff at the end is achieving the goal, but sometimes it can be hard to stick with a large goal if there aren’t regular payoffs.

Reward yourself for achieving your smaller weekly or monthly goals. If you got your $800 saved for the month, give yourself a night out, a new book or game, or a meal at your favorite restaurant. The key is finding a reward that motivates you. It could be financial (spending money on something you want) or not (taking a self-care day). It doesn’t really matter what the reward is, as long as you associate it with achieving your goal. Doing so will sort of trick your brain into wanting to work harder to achieve the steps you laid out because it will want that little award for doing so. I’m no psychologist, but I think it works that way.

Get out There and Slay Your Goals!

Now that you know how to set smart financial goals and have some great methods for achieving them, what are you waiting for? Get out there and start achieving your financial goals today!