According to a recent Capital One Survey, only one third of American’s feel like they accomplished some of their financial goals while 20% feel like they accomplished none.
If you’re sick and tired of not making headway on the important goals you’ve set for yourself, it’s time to do something different. Here are four of the most important steps you need to take when setting your goals. (And be sure to check out the bottom of the post for a helpful giveaway to get you started!)
Prioritize Your Goals Based on Impact
One of the biggest mistakes goal setters make is not prioritizing goals. While you might want to overhaul your entire financial life in one year, it’s not possible. You need to start by taking a good look at your financial situation and deciding which few goals are going to make the biggest impact on your overall financial picture.
Here are some ideas to get you started:
- Build an emergency fund of three months’ worth of expenses
- Pay off your credit card debt
- Pay $10,000 on the principal of your student loans
- Save $10,000 toward a down payment on a house
- Open up a retirement account and invest $200/month
If you don’t have an emergency fund, start there. You’ll feel much better when you know there’s fall back money for a true emergency. Build up at least a few months’ worth of expenses while still meeting all of your other monthly obligations. (Like minimum debt repayments.)
After your emergency fund is in place focus on high interest consumer debt. Ridding yourself of consumer debt can free up extra cash flow and lift the heavy burdens that come with owing money.
If you already have an emergency fund and are debt-free choose the goal that’s most important and impactful to you.
Plan It All Out
Once you’ve picked a few goals to work on it’s time to make a plan. A goal without a plan behind it is pretty darn useless.
You should have an idea of…
- How long it will take you to reach your goal
- Where the funds will come from
- Monthly and weekly target amounts to reach the goal
Having a plan is one of the most important steps you can take to finally reaching your financial resolutions. It’s senseless to set a goal without thinking and planning how you’re going to achieve it.
If you want a single place to manage your spending and saving decisions, check out Level Money, a money management app that can help you achieve financial balance.
Automate When You Can
With the abundance of free financial tools available the need for willpower has become a thing of the past. This is good news for you and me. Relying on willpower alone doesn’t really work for anyone. Instead, you need to set up a system.
If one of your goals is to save more money this year set up an automatic savings plan to do the work for you. Simply open an online savings account and have money automatically transferred from your checking each month or each time you get paid.
Treat this savings the exact same as you would treat a bill. Set it up to happen the same day every month and plan for it!
Automate as much as you can so that you’re not relying on willpower alone to achieve your goals.
Prioritize Self Improvement
Another step that is so crucial is prioritizing self-improvement. This is a broad topic and can include many different things.
Here are some ideas:
- If you’re just learning about personal finance go to your library and get a new personal finance book each month.
- If you want to start investing but are completely confused, take an investing course.
- If you want to earn more money this year learn a new skill or take a class that will help further your current career.
Educate yourself in the areas you’re lacking knowledge in. You’ll feel empowered and will be much more motivated to stick with your goals.
Keep Yourself Organized
To help you reach your 2016 New Year’s resolutions, I’m doing a giveaway (with the help of Capital One Bank), offering you the chance to win a New Year’s Resolutions Starter Kit. From fun and organizational calendars to digital news subscriptions, the kit will include the following helpful tools to help you reach your resolutions, stay organized, and up to date in 2016:
- Increase Creativity: To increase your creativity, carry a portable notebook to jot down ideas on the fly. That’s why we’re including an Evernote 2016 Notebook in the kit.
- Focus on self-improvement: To inspire yourself to take effective action and achieve true success with a great read, we’re giving you a copy of Take The Stairs: 7 Steps to Achieving True Success
- Learn to plan ahead: While I love using apps like Level Money, sometimes you’ll want to plan your finances with the help of a financial calendar, colored pens and bright sticky notes. That’s why we’re including a Financial Goal Calendar in the kit.
- Get in the know: Financial news can be scary, but getting into a habit of staying up to date on business and finance can help. That’s why we’re giving away digital news subscription for one year!
- Make it a family affair: One of the biggest things you can do to make money management a snap is to use smart organization strategies to build a financial plan and stick to it in 2016 and beyond. That’s why we’re including a Home Financial Organization Kit!
- Tax time checkup: It’s almost tax time, so why not leverage tools to search for tax breaks and step-by-step guidance come tax time? That’s why we’re including a free copy of TurboTax Basic.
So, in this New Year’s Resolutions Starter Kit, you’ll get:
- An Evernote Notebook
- Take The Stairs: 7 Steps To Achieving True Success
- A Financial Goal Calendar
- A free one-year subscription to a financial publication of your choice
- A Home Financial Organization Kit
- TurboTax Basic
Ready to enter? Simply enter using the Rafflecopter widget below. The giveaway runs from January 6, 2016 until January 31, 2016. See terms and conditions below. Good luck!
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him here and here.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.