By Peter Kelly on 25 January 2024
The new year is a great time to reflect on your financial situation and plan for the future. Whether you want to save more, pay off debt, invest wisely, or simply live within your means, setting financial goals can help you achieve your desired outcomes. Here are some tips on how to set realistic and attainable financial goals for 2024.
Start with your “why”
Before you set any specific numbers or targets, think about why you want to improve your finances.
What are your values, dreams, and priorities?
How do you want to feel about your money?
Having a clear vision of your purpose can motivate you to stick to your goals and overcome challenges.
Assess your current situation
To set effective goals, you need to know where you stand right now.
Review your income, expenses, assets, liabilities, and net worth.
Track your spending habits and identify areas where you can save or cut costs.
Analyse your debt and interest rates and plan how to pay them off as soon as possible.
Set SMART goals
SMART stands for Specific, Measurable, Achievable, Relevant, and Time-bound. These criteria can help you create clear and actionable goals that are aligned with your vision and values.
For example, instead of saying "I want to save more money", a SMART goal would be "I want to save $10,000 by December 31, 2024 for a down payment on a house".
Break down your goals into smaller steps
Once you have your SMART goals, divide them into smaller and manageable tasks that you can do on a daily, weekly, or monthly basis.
For example, if your goal is to save $10,000 in a year, you can break it down into saving $833 per month or $192 per week. This way, you can track your progress and celebrate your achievements along the way.
Review and adjust your goals regularly
Setting financial goals is not a one-time event. You need to monitor your performance and evaluate your results periodically. If you are falling behind or facing unexpected challenges, don't give up. Instead, adjust your goals accordingly and find ways to overcome the obstacles.
On the other hand, if you are ahead of schedule or have achieved your goals early, don't stop there. You can either set new goals or increase the difficulty of your existing ones.