How to Avoid Getting Overwhelmed by Financial Goals this Year
Now that the new year is underway, chances are that you are reviewing your financial goals and wondering what you were thinking. Can you really make your goals work this year?
Before you give up (as most people do early on), consider the following strategies that can keep you from getting overwhelmed:
Focus on the Most Important Goal
Too often, we make a long list of all the things we want to do, attempting to solve all our financial problems in a single year. This approach isn’t always realistic. Instead of trying to get through your entire list this year, look at your goals and identify the most important thing you want to accomplish with your money.
Decide what you want to tackle first, and then break that down into manageable steps. Rather than having an overwhelming to-do list, you now have one major goal that you can spend the entire year working on. This can help you focus your efforts and make measurable progress.
Step Up Your Efforts
You don’t need to try to accomplish your goal all at once. If your goal is to contribute $300 a month to your emergency savings, you probably aren’t going to be able to suddenly meet that goal. Instead, step up to your goal. Decide that you will spend 10 months working up to getting to that $300 per month mark.
For the first month, look for ways to find $30 to set aside. It’s much easier to cut $30 from your budget and put it in your emergency savings account. The next month, you look for another $30 to cut from your expenses (or you can attempt to earn more as well). You continue with the original $30, but add to it, so at the end of your second month, your new monthly total is $60. You continue this process, looking for another $30 each month. At the end of 10 months, you will have “freed up” $300 each month, and you can keep setting that money aside in your emergency fund.
This process works well when paying down debt, saving for retirement, saving up for a down payment on a house, or working to “find” extra money for almost any goal. It’s more manageable, and it gives you time to truly change your habits for the long haul. Use a high-yield savings account or a match program like BoostUp to accelerate your efforts.
Remember You Can Start Again Anytime
Finally, don’t assume that you can only make goals at the beginning of the year. The reality is that you can make goals anytime you want. If you find yourself slipping, start again, no matter what time of the year it is. If you accomplish the most important goal on your list early, figure out what the next goal should be. Don’t wait for a new year to start to keep improving your finances. Financial success is an ongoing journey, not a finite situation based on time of year.
It’s also possible to take longer on your goals. The important thing is to keep moving forward, making progress. If your goal is especially big, consider setting a two-year or three-year time frame on it. Don’t limit your financial success efforts to a 12-month period. While it’s natural to want to start new projects with the new year, don’t get hung up on the idea. If you falter, make a new plan, and start over again. All is not lost if you get off track. Re-evaluate your expectations and move forward. As long as you are making progress with your finances, you haven’t failed.
Miranda Marquit is a freelance journalist specializing in topics related to personal finance, investing, and entrepreneurship. She writes regularly for a number of web sites, including AllBusiness, Huffington Post, and Wise Bread. Miranda’s work has been published at U.S. News & World Report, MSN Money, Fox Business, and Business Insider. Her work has been linked to from USA Today, the Washington Post, and the Wall Street Journal, and she has appeared on NPR Morning Edition and American Public Media’s Marketplace