Here's How My Husband and I Set Our 2024 Financial Goals
KEY POINTS
- Setting financial goals can help you be more successful in your personal finances.
- My husband and I work together to set a short-term, medium-term, and long-term goal each year.
- We make a list of priorities and consider what we're both passionate about and what's feasible.
According to research from The Ascent, two-thirds of survey respondents intend to make financial resolutions for the 2024 year.
I don't make resolutions, since I know that many fail even before the end of January. But, my husband and I do set personal finance goals for ourselves. In fact, each year we work together to create a few objectives, and we've achieved them pretty much every year since we started the process.
Here's how we set our goals and the steps we take to make sure that we achieve them over time.
1. We set a short-term, medium-term, and long-term goal
When we set our financial goals, we don't want to make too big of a list and find ourselves overwhelmed with everything we're trying to do. Rather than aiming to accomplish tons of things at once, we focus on setting one short-term goal, one medium-term goal, and one long-term goal.
For example, last year we wanted to save for an RV as our short-term goal that we accomplished within the year. We also wanted to finish working toward funding a home remodel, which was a medium-term goal we've had for a few years. And we wanted to continue working on our long-term goals of investing in our brokerage account for retirement and our children's education.
By focusing on just three objectives, we can make sure we're using our resources wisely and won't spread ourselves too thin. If you're setting our own financial goals, try to think about a few big ones that really matter to you so you can devote your resources to actually accomplishing them -- rather than hoping to do too many things at once and not ending up doing any of them.
2. We both make independent lists and then find what we're both passionate about
Another important step in our goal-setting process is making sure we're both on the same page. After all, it's easier to accomplish something if we're working together and if we're both excited about it.
To make sure we're united in our goals, we both make separate lists and then look for areas where there is overlap. If you have a partner and you're trying to work on money issues together, taking the time to consider your separate desires and then finding areas of compromise can be really helpful.
3. We consider whether the goals are realistic and achievable
We don't want to set ourselves up for failure, so we work really hard to make sure that the goals we are setting are things we can actually accomplish. We don't, for example, make ridiculous plans like trying to save tens of thousands of dollars a month for retirement or trying to buy a house in a year.
We look at what we'd have to do to accomplish each goal and break it down to make sure it's affordable. For example, if we were trying to save $30,000 for an RV in a year, we'd do the math to figure out we need to save $1,666.67 per month and we'd try to see if we can fit that into our budget. If we find that this isn't doable, we'd go back to the drawing board on our goal.
If you're setting a goal, be sure to consider the cost and time limit to achieve it, see how much of your money you'd need to use each month, and make sure it's actually possible.
4. We create a detailed plan and automate the process
Finally, once we know what our goals are, we make a detailed plan and automate the process to make it easier. So, for example, if we decided we were going to save $1,666.67 a month toward an RV purchase, we'd set up automatic transfers from our checking account on the day we get paid into a special savings account earmarked for that goal.
This process has worked really well for us every year, and if you want to maximize the chances of accomplishing your own goals, it may be worth putting your head together with your partner and trying these steps yourself.
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