Setting SMART goals helps remove ambiguity and makes achieving the goal easier in the long run. Let’s walk through what smart goals are and an example so you can set your own.
The examples provided will be 1) losing weight and 2) saving money.
S - Specific
When beginning your goal, try to answer the 5 Ws:
- What am I trying to accomplish?
What resources (time, money, people, etc) are needed?
- Why is it important?
- Who else is involved? Are others doing it with me?
- When can I regularly work on this goal?
- Where will I work on this goal? (or where is it located?)
M - Measurable
- How will I know my goal has been accomplished?
EXAMPLE 1: I want to lose 30 pounds - instead of "more weight" because it's easy to measure this.
EXAMPLE 2: We need to save $40,000 for a 20% downpayment on houses that have the space to meet our needs.
In both of these examples, having a specific number and a clear understanding of what is required makes the goal more focused. This way, it is clear what you're working toward and when you are done.
A - Achievable
- Is this a realistic goal?
- How can I achieve it?
EXAMPLE 1: I can lose 30 pounds because I would be within a healthy weight range for my height if I do so. By focusing on losing 3-4 pounds a month, my goal is more realistic and can be a sustainable change.
EXAMPLE 2: It feels far-fetched right now, but is achievable as long as we are consistent. Realistically we can save $500 a month right now, meaning it would take 80 months or 6.7 years to reach our goal. To make it more achievable we could cut some of our spending on eating out or on streaming services and put that toward savings.
R - Relevant
- Is this a worthwhile goal?
- Is it the right time to work toward this goal?
T - Time Frame
- Make time-bound goals.
- What can I do each week?
- What can I do each month?
- What results can I see in 6 months?
- When do I expect to be completed with my goal?
EXAMPLE 1: I think I can realistically lose 3-4 pounds a month, so it will take 8-10 months to reach my goal.
EXAMPLE 2: Based on saving $500 a month it will take 7 years to reach our goal, but we want it to take 5 years. By cutting down streaming services and eating out we could save $680 per month and be done with our goal in 4.9 years!
Now practice setting your own goal using these 5 factors. What is something you've been wanting to make happen? Financially Fit also offers more resources on Smart Goal Setting to members under our "tools" section. Feel free to read more information or reach out with questions. Our team is here to help!