A Beginner’s Guide to Setting Financial Goals 

It’s easy to get trapped in working just to pay your bills. But your paycheck should do more than this! Working hard should allow you to reap bigger rewards, which may require you to set some financial goals. Start by keeping these four things in mind. 

Own your goals. It may be tempting to set financial goals by looking at #TravelGoals of popular influencers, or the plans of your friends and colleagues to buy a new car or save for their own home. There’s nothing wrong with this, but you do need to make sure these are things you really want for yourself, and not something you aspire for just because everyone else is doing it.
 

Ask yourself, what truly matters to you? What kind of life do you imagine yourself living five, ten, twenty years from now? What does your ideal financial situation look like? These questions can guide you in shaping financial goals that are uniquely your own. 

Set SMART goals. Once you have a picture of the kind of life you want to have, refine that overall goal into one that is SMART– Specific, Measurable, Achievable, Relevant, and Time-bound.
 

For example, make “I want to travel” more specific by deciding on a place and time, such as “I want to travel to Japan in 2027.” Make it measurable by figuring out how much you need to save up before 2027, and achievable by breaking down that total to smaller amounts to set aside every pay period. Your reasons for wanting to go specifically to Japan make it relevant, while the 2027 deadline makes it a time-bound goal. Then your SMART goal becomes “I need to set aside X amount every month until 2027 to be able to travel to Japan.” 

Decide on short, medium, and long-term goals. Traveling to Japan is an example of a short-term goal, which is one that you can achieve within a year. Aside from travel, other goals could be buying a new gadget or luxury item or saving up a specific amount by the end of the year. To achieve these goals, you need to set aside a portion of your income and work with what you have.
 

Medium-term goals are those that are achievable between one to five years. Buying a new car, pursuing higher education, and starting a business are some examples. These require planning, and you can look for investment opportunities that make your money grow within this time.
 

Long-term goals require you to look farther into the future, beyond the five-year mark. It could be a big milestone like buying a house or preparing for your retirement. Since there’s a lot of time to work with, you may need to make certain projections about your income and investments to meet these goals. 

Look beyond having new things and experiences. Financial goals are not all about acquiring things, whether it’s this year’s latest gadget or a new house in ten years. You can set financial goals that improve your current state of life.
 

If you’re drowning in credit card debt, make a SMART goal by saying “I will be debt-free free by the end of 2025.” You can also target to build an emergency fund of a certain amount so you can have peace of mind in the face of unforeseen circumstances, or you may simply strive to stop living from paycheck to paycheck. These may all sound like #Adulting101, but they are good financial goals to have, too. 

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