How to Set Goals that Are Realistic and Achievable
There is a lot of talk about New Year’s Resolutions at the end of any year. But wouldn’t it be better to know how to set goals that are realistic and achievable?
Many people have the tendency to fail at resolutions. But well-planned and realistic goals are more achievable.
In short, goals are better than resolutions.
And goals that are especially on point with regards to your finances are important to many people.
In this article, I’m going to explain how to set realistic and achievable goals to have a financially better 2024.
SMART Goals: How to Set Goals the Right Way
You can’t get somewhere if you don’t know where you’re going, so defining your goals is the first step.
So make a plan for your finances and set some goals.
The goals should be SMART.
SMART is an acronym…
Specific – For example, I want to increase my performance at work within x number of days.
Measurable – Your goal needs to be tangible and measurable. If it’s not CLEARLY easy to measure then it’s not the right goal.
Achievable – Don’t make your goal so big that you can’t achieve it. Stretch yourself, but aim small enough that you’ll hit your target.
Realistic – This goes along with what is achievable. For example, if you currently only have an output of x at work then it’s not realistic to say you’ll 10x it in only a month.
Time Bound – Set a timeline for when you’ll hit this goal. A goal without a timeline is just an idea. A goal with a timeline is something you’ll hit.
Your goals also should and are driven by what you value.
If you value time or money or family, that will reflect in how you go about accomplishing your goals.
Below is an example of what setting up goals for your business might look like.
This is only one small aspect of a business, which is a good example of how detailed your goals could be.
Define each part of this diagram using the SMART goals mentioned above and you will have won half the battle with your goal.
Check out my article about how to create better money habits.
How to Set Goals that Are Realistic and Achievable
If I’m only making $2,000 per month, for example, and make a goal to make $200,000 next month, what do you think will happen?
I’ll most likely fail.
That’s because it’s not realistic.
And the trick to achieving goals is to make them realistic.
To make a realistic goal, with finances or otherwise, it’s important to evaluate three things:
- Where you are
- Where you want to be
- The method, or steps, are needed to get there
First, Where Are You?
Are you making $2,000 or $5,000 per month? Establish where you are now to know how far you need to go to get to where you want to go.
This will require budgeting if your goals are financial. But don’t worry, budgeting is easier than people make it out to be.
Check out the tool I use to help me budget called Everydollar.com.
Next, Where Do You Want to Go?
You need to have a clear idea of where you want to go.
Do you want to get to $10,000 per month or $1,000,000 per month? You need to have that number, or goal, clearly in your mind.
Now write it down!
Any goal not written down is just a dream and will likely not materialize.
Lastly, What Is the Best Method to Achieve Your Goal
For example, if you have a consulting business and are making $2,000 per month and you want to make $10,000 per month, break down the steps to get from $2k to $10k.
You could charge more, get more clients, have more clients on retainer, create a product to sell in addition to your consulting, etc.
These are examples of what you could do to increase your income, but it’s important to know how long each will take.
If you continue to get the same amount of clients each month, but increase your prices, it’ll usually take less time than increasing the amount of clients you get each month.
Creating a product will also take time.
To say you’ll increase your income from $2,000 this month to $10,000 next month is only realistic and achievable if you take the necessary steps to make it happen that quickly.
And that’s how to set goals that are realistic and achievable.
In a Nutshell
Knowing how to set goals that are realistic and achievable is necessary to make progress. Without them, we stay stagnant in life.
Look at what you want and where you want to go in life and set goals.
Write them down and evaluate a plan to tackle them.
Yet if you fail at achieving your goals, you should never give up.
Just pivot and try again. The more you do that, the better you’ll be at setting SMART goals.
And that is how you get closer and closer to having everything you want in life.