Setting financial goals for the year ahead will help you focus your spending, so you’ll have funds to pay for the things you really need and want. “If you aren’t working toward anything specific, you’re likely to spend more than you should,” writes Amy Fontinelle on investopedia.com.
While there are many approaches to setting financial goals, even the most minimal planning efforts pay off. Research shows that “simply jotting down a list of financial goals makes you 42% more likely to achieve them.”
Start now to join the 3 out of 4 Americans who are making financial plans for 2019. To help you get started, here are expert tips on setting goals to improve your finances and staying on track…
How to set your financial goals
- Reflect on the state of your personal finances over the past year. What worked out well for you? What didn’t?
- List your debts. Make note of any expenses you might be able to decrease or eliminate.
- Looking ahead to the coming year, estimate your total household income.
- Identify any increased or new expenses you’re anticipating in 2019. Are you moving? Do you need a new car?
- What are your goals for 2019? Pay off credit card debt? Plan a family vacation?
- Based on your notes, establish a realistic budget in writing. For help, read our blog post, “How to End Your Money Stress Once and For All!”
- Remember to set aside money for savings or an emergency fund!
How to stay on track to achieve your goals
- Store your written budget where you can easily refer to it. Smartphone apps give you quick access and depending on the features can even track your spending.
- If you’re not using a budgeting app, use another system to monitor your progress towards your goals.
- Keep accurate records of your spending.
- Schedule time each month to review your finances and fine-tune your plan, if necessary.
- Get smarter about financial planning by checking out books or attending free workshops at your local library.