How should I start setting financial goals?

Imagine running a 5k has been one of your goals for a long time and you want to check it off your list. Alarm sounds an hour early. Roll out of bed. Put on your running clothes, sneakers, and headphones. Run 2 miles before heading to work. Repeat again tomorrow. 

There are some sacrifices of time and sleep for a while, but after a few weeks of training, you realize that the hardest step was just getting started. You might have even found a new hobby and you’re getting into better physical shape. You remain committed and what a feeling when you cross that finish line!

Financial goals are not much different. We have to decide what we want to accomplish and put together a plan of action. Just like training for a 5k, it requires daily focus, sacrifices and making some tough choices.

How can I stay motivated?

Instead of thinking about not eating out or shopping as often, think about how the money you saved is getting you closer to your financial goals. Knowing why you are making these choices is your motivation to see your goal through to the end.

How long should I be working on my goals?

Your financial goals will have different time frames. Some may be short term; it might take a week, a month, or a year to build an emergency fund or save for new furniture. Others may take longer (a medium term goal) like saving for the down payment on a house, buying a car or paying off a specific debt.

Long term goals like saving for retirement, saving for a child’s college fund or paying off a mortgage take many years. You have to find motivation to make it to the end. So, picture yourself on your new sofa, paying an unexpected bill (with your emergency fund), in your new home, not stressed about your financial future because you’ve paid off some debts and are saving for retirement.

What steps can I take today?

Ready to set your goals?  Here are some steps to get started:

  • Write down your goals, their time frame and priority. Are they short, mid or long term? High, medium or low priority? Start with just your highest priorities.
  • Make each goal specific. We recommend using the SMART goal method. For example, “I would like to save $1,000 in eight months for new furniture.”
  • Review/create your budget and see what funds you have leftover each month. If it’s not as much as you’d hoped for, look at your current spending habits and see where you can cut back (sacrifices), or look for ways to bring in additional income.

Once I get started, what else can I do?

  • Determine the amount you need to save each month to meet each goal. Using our furniture example: $1,000/ 8 months =$125/month. Take the total amount of each goal and divide it by the number of months you need to accomplish it.
  • Set up automated savings. Once you settle on an amount you want to save, set up an automatic transfer from your checking account to a separate savings account.
  • Let it grow.  Resist the temptation to dip into your funds or to pull your money out for other things. Let your savings grow and increase your monthly contribution if you can.

How can BrightDime help me?

  • Review your goals each year. Life happens and things change. Are these still your goals and your priorities? BrightDime coaches can help you figure out how to adjust as needed.
  • Monitor your progress.  Check in with a coach to on a regular basis to see how you are progressing, and celebrate your small successes to re-energize yourself to keep going.

To get started with your new goals, head to your BrightDime dashboard today!