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Setting Financial Goals & Strategy: 4 Simple Steps

We all have money goals but it can be difficult to know how to go about achieving them.

Knowing how to set goals that work towards something specific keeps you from spending more than you should. With this system, you’ll stay more motivated and more likely to complete your goal.

Below, I’ll go over setting financial goals and the strategy to achieve them. By making yearly financial goals and following this 4-step strategy, you’ll have a clear plan for hitting

Setting Financial Goals & Strategy To Achieve Them In 4 Simple Steps

How To Set Financial Goals

How do you figure out which financial goals to work on right now? Go through this short exercise of writing out all your goals and assessing them systematically.

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It’s easy and quick, I promise.

1) Figure Out Your Priorities

What is most important to you? If something is a big deal to you financially, you’ll be more motivated to work towards it.

Write down all of your money goals, including ones that seem unattainable right now. Writing them down will help you remember other financial goals you had forgotten about.

You’ll want to include short-term, intermediate, and long-term financial goals.

2) Asses Your Goals List

After you have a nice list of goals, you’re going to want to narrow it down. Prioritize and assess which of the goals will be attainable under your current circumstance.

For example, if one of your goals is to maximize out your retirement savings but you still have a lot of consumer debt, it would make more sense to have the goal of paying off the debt completed first.

3) Create A Shortlist

After you’ve assessed your financial priorities and feasibility, you should narrow that goal list down to a handful. Too many goals make it overwhelming.

The goals you’re going to want to work on now are the short-term financial goals. This will give you easier wins that will self-motivate you to continue.

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Hold onto the list of goals that don’t make the shortlist. Those are still a part of your long-term financial strategy. As you complete more of your current money goals, you can add in additional goals from your long list.

4) Post Your List Prominently

Once you have your shortlist, print it off and place it somewhere prominent. I recommend somewhere you’ll see it frequently, like the side of the fridge.

Keeping your list out in the open gives yourself a constant reminder of what you’re working towards.

Easy 4 Step Financial Strategy To Reach Your Money Goals

Now that you have your list of financial goals, you’ll need a strategy in order to achieve them. This 4-step financial strategy will guide you through the best ways to achieve your goals.

1) Define Your Financial Goals Using SMART

The SMART goal system stands for Specific, Measurable, Achievable, Relevant, and Timely.

If your goal is to be better with money, what do you consider to be bad about your money skills? Are you going over budget monthly? Do you spend too much eating out at restaurants? Would you like to have more in savings? 

If your goal is to have money in savings, what is the purpose of this money? Is it an emergency fund, vacation savings, or car repairs? How much money are you hoping to have saved and by what point in time?  

Since the goal is on your list, you’ve already determined it to be relevant and achievable. By putting a number amount to the goal and giving yourself a timeline, you’re focusing your efforts.

Make sure you’ve identified short term, intermediate, and long-term financial goals. This will give you a better overall picture of what your savings plan should be.

2) Work Backwards From The End Goal

With each goal, start from the end in mind and work your way backward in time to the very beginning.

Here are possible steps for someone who’d like to be financially independent.

I chose this example because it’s a long-term goal that can feel impossible to achieve. I wanted to break down this process on a difficult financial goal to show you how this can make goals seem so much easier.

Goal:  Be Financially Independent

To be financially independent I will need to…

  • Have $2 million at retirement age 65

To have $2 million at retirement I will need to…

  • Save $2k monthly for 30 years

To save $2k monthly I will need to…

  • Increase my income an extra $500/month since I already can save $1.5k/month

To increase my income by $500/month I will need to…

  • Pick up a side hustle or get a certification to get a better job or renegotiate my salary, etc.

You get the idea.  You’re writing down the exact steps that need to be taken.  It’s a shaping plan for the successful completion of the goal.


3) Be Creative And Persistent

There aren’t blueprints for goals.  Everyone’s steps will be different.

In the above example, some people may not be able to save anything yet because they have outstanding debts.  Their plans will involve paying off those debts first before saving up money.

If a goal seems unattainable, think outside the box.  A person whose goal is mortgage-free homeownership may implement house hacking or Air BnB to help pay off their mortgage.

Someone who wants to go to medical school but can’t fathom the idea of $200k in school debt may join the military to pay for their degree.  

Related: Learn how to go to college debt-free with these options.

4) Keep Track Of Your Progress & Recalibrate When Needed

Once the goal’s steps are plotted, identify where you are on it.  Post your steps somewhere you’ll see them daily.

The best time to plant a tree was 20 years ago. The second best time is now.

Chinese proverb

Just like how interest compounds in the stock market, invest in yourself and do a little bit every day.

How To Make A Financial Plan And Strategy To Reach Your Money Goals – Conclusion

Writing out your goals and making a plan will put you ahead of most people. Few rarely put in the time to work towards their goals and end up staying dreamers their entire life.

By having a clear plan that you’re working towards as a visual daily reminder, you’re far more likely to continue progressing. The difference between someone who is a success versus failure is that the successful person kept going despite their prior failures.

Let me know some of the goals you’re working on in the comments.

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