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For many of us, at least one of our New Year’s resolutions revolves around our health: cutting back on carbs, working out four days a week, losing a little weight, or something along those lines. But health goes beyond our physical fitness; it applies to our finances, too! Many of us likely set some financial goals going into the new year, such as saving for a big trip, buying a home, or getting debt-free.
In an ideal world, becoming financially stable would be easy. However, like physical fitness, financial health requires patience, consistency, and intentionality to achieve results. And it all starts with setting financial goals for ourselves.
SETTING YOUR FINANCIAL GOALS
Without a clear, meaningful objective to work toward, it can be easy to become distracted or complacent — which is why setting financial goals is so important. No matter where we are on our financial journey, there will always be ways to grow and improve our financial health.
We recommend starting each year with some financial planning. This is the perfect time to review current goals, add new ones, and evaluate progress from the previous year. As a good rule of thumb, every goal should be SMART: specific, measurable, achievable, relevant, and time-based.
Your financial plan should include long-term and short-term goals, but the specifics of those goals are entirely up to you! Ultimately, your financial goals should be tailored to you and your current finances, not based on the opinions and appearances of those around you.
THE VALUE OF GOOD SPENDING HABITS
As with physical fitness, consistent effort is the key to improving our financial fitness. In addition to repping weights, try repping good spending habits, too! For example, if you feel the urge to make an impulse purchase, take time to step away and think about it first. In many cases, an extra day or two gives you the perspective you need to avoid making a bad financial decision or incurring unnecessary debt.
Most importantly, make a plan! Planning how you spend and save will help you be more aware of your finances. Start by determining how much money comes in and goes out each month, and then build your budget around that. Then, pay attention to how you use your money and adjust as needed until you’ve set a realistic budget.
IT'S A MARATHON, NOT A SPRINT
While being motivated to reach our goals isn’t bad, it’s important to remember that the result often matters more than how quickly we achieve it. Here are a few ways to increase your financial stamina as you race toward your goals:
Start With a Long-Term Mindset
When setting and working toward your financial goals, keep the bigger picture in mind. How will your choices today affect you later? Buying those new shoes or treating yourself to takeout when you still have food in the fridge may feel good at the moment, but it helps to consider whether they will get you closer to your future goals.
Set a Sustainable Pace
If you try to sprint a marathon, you will run out of energy long before you finish. Similarly, overcommitting to your financial goals can lead to increased stress and early burnout. Instead of biting off more than you can chew, set achievable savings goals, create a manageable budget, and follow a realistic debt repayment plan.
Celebrate Small Victories
The final result isn’t the only thing that matters. Every step you take toward your goal is a little victory. Small wins now can lead to bigger victories down the road, so celebrate each one and use them as motivation to keep moving.
Stay Focused on the Finish Line
When you start any race, you know that a finish line waits at the end, whether you can see it or not. The same goes for your financial goals! Your end goal may feel far away, but if you focus on making consistent progress every day, you will
Healthy habits take time to form, so be patient with yourself as you work toward your financial goals. There will be setbacks, but there will also be wins. Just take everything in stride and continue pushing forward. We promise it will be worth it in the end!