It is exceptionally easy to sit back and lament about the fact that you’re going to pay off your debt in the next 12 months, save enough for a down payment on house, build an emergency fund and pay off your cars in the next 24 months. It’s easy; you can see it and you can achieve it, right? But that’s just what happens when people get the bright idea to do that really cool trendy new thing called “saving” and setting financial goals. The bad news is that most people have goals that are completely unachievable and not particularly realistic in any matter of speaking. For example, you might say that paying off all your debt in a year is a very realistic goal, but it’s only realistic if you make enough disposable income and have little enough debt to pay it off. If you make $15,000 per year and have $45,000 in debt to pay off, it’s not a realistic goal. It’s just that mathematically simple. But we do have a few suggestions that will help guide you through the process of making realistic financial goals. Get ready; this is good stuff.
The most important thing you can do when setting realistic and achievable financial goals is to be specific. Don’t just say you want to pay off your debt or save money. Make it specific; which debt do you want to pay? What kind of savings are you looking to achieve?
Choose a Specific Target
Now that you have a specific goal in mind, break it down into a specific target. You want to pay off your $10,000 in debt and you want to do it in one year. So that’s your specific goal. Keep that in mind.
Opt for Small Goals Leading to a Big Goal
Next is where you make the most proverbial bang for your buck. You will now figure out where to get the money to pay that debt. You will make small goals; turn off cable and put that toward debt, use tax refund to pay down debt, put all additional monies toward debt, turn hobby into profitable side business to make additional debt-paying money. Those are small goals you will meet along the way to your big goal to keep you on track.
Never fail to meet a goal or at least try your hardest. There are always unexpected occurrences that will knock you off track, but you should be as consistent as possible when you set goals that you’re going to reach them, because it’s what makes the biggest difference.
Give Yourself a Timeline
The most important thing to do is give yourself a timeline. It’s what makes things seem real and realistic, and it’s what’s going to make it possible for you to meet your goals and get through your life without issue.
Photo by David McNew/Getty Images