Make Your Money Resolutions SMART Goals That You’ll Actually Achieve

An African American woman celebrates.
Getty Images

We all have financial goals we’d like to achieve. Save more money. Get out of debt. Improve our credit scores.

But we’ve also seen our well-intentioned resolutions never become reality.

The key to setting goals we’ll actually stick to is to make sure they’re SMART:

  • Specific
  • Measurable
  • Attainable
  • Relevant
  • Timely

Designing SMART financial goals will help you get where you want to be with your money.

Setting Money Goals As SMART Goals

Let’s break down each aspect of setting SMART goals.

1. Make Your Goals Specific

The more explicit and detailed you can be about your money goals, the better.

Use specific numbers. Describe exactly how you’d like to carry out your money mission.

For example, it’s too broad to simply say you want to increase your emergency fund. A more specific goal would be: I’d like to increase my emergency fund by $600 over the next six months by auto-drafting $50 from my bimonthly paycheck to my savings account.

Being specific gives you a game plan to follow. You’ll know exactly what you’re working toward and how to get there.

2. Make Your Goals Measurable

You’ll need to track your progress as you’re working to meet your financial goals. That’s why it’s important to have something to measure.

It could be a dollar amount. Perhaps you want to pay an extra $100 above the minimum payment on your auto loan each month.

You could choose to focus on a percentage, like setting aside 15% of your take-home pay to put into a Roth IRA.

You might measure your goals in terms of a particular action. If you’re looking to bring in more income, you might vow to fill out five job applications per week to positions in a better-paying field.

However you structure your goals, make sure there is something you can measure so you can assess whether you’re making progress.


3. Make Your Goals Attainable

Setting an unrealistic goal is just setting yourself up for failure. While it’s nice to shoot for the moon sometimes, you’ll have a better chance of meeting your objectives if they’re actually attainable.

If you make barely over minimum wage and you live paycheck-to-paycheck, setting a goal to increase your savings by $20,000 in one year is probably unattainable. Factor in your current circumstances when drafting your financial goals.

Ask yourself: Does this seem realistic for me to achieve? What hurdles will I have to overcome? Will I burn out trying to do something nearly impossible?

Goals are meant to be challenging, but they should be attainable as well.

4. Make Your Goals Relevant

Knowing the “why” behind creating your goals is essential.

It’s not enough to just say you want to raise your credit score. Saying you want to raise your credit score by 80 points so you can get approved for a mortgage for a home in your dream neighborhood is a much stronger goal.

Your money goals should tie into what you want to see happen in your life. Make your goals significant and relevant by exploring why you want to see them to fruition.

5. Make Your Goals Timely

Deadlines can be annoying, but they are oh-so-necessary when it comes to achieving a goal.

Give yourself a date for when you’d like to see your goal accomplished. Your goal then becomes timely because you’ve got a deadline to make it happen.

Be specific and realistic about your timeline. Bonus points if you can break down segments of your goal and give them their own timelines.

Say, for example, you’d like to purchase a home in the next 12 months. Perhaps you spend the first five months paying down debt so you can get your debt-to-income ratio under 25%. Then you spend the next five months building up your savings for the down payment and closing costs. You can dedicate the remaining two months to touring houses within your budget.

Craft your goals around something you can take action on now so you can start making progress toward achieving them sooner rather than later.

Nicole Dow is a senior writer at The Penny Hoarder.