Note: This is a 2-part post. Part 1, which you’ll find below, goes over how to set goals that you can reach. Part 2 provides real, concrete examples of financial goals you can set for the new year and beyond. To access part 2, sign up for my completely free email list.

Every year, we take a day or two to think about our past year and how we could improve. While I’d argue that we should do it far more often, New Year’s Resolutions are a great beginning to help you get on the road to your ideal life.

But as we all know, most resolutions fail, and they fail quickly. You plan to eat better only to be drinking milkshakes again by March. And who among us hasn’t resolved to work out more, only to cancel their gym membership before the year ends?

We need goals. It’s how we assess our progress and move forward, both as individuals and collectively. If you’re tired of not hitting your goals, I’m going to cover what you can do about it. Stop setting goals that are just fantasies, and start working towards your dream life. It’s easier than you think.

Goals Make You Feel Good

Goals are markers of progress. When you reach your goal, you feel good. You know that you’ve accomplished something.

Think back to a major goal you accomplished in your life, and how it made you feel. Here’s an example: When I was a junior in college, I had a summer job working in the I.T. department of the Ferguson Student Center at Alabama. I didn’t get paid all that much as a student employee, but it was a pretty easy job and it gave me a lot of time to work on personal projects and homework.

Since I knew I’d be working overtime that summer to handle all of our new student orientations, I set a pretty lofty savings goal. I wanted to set aside 50 percent of every single paycheck I got from the time school got out in May until classes started back up in August.

I also set a pretty clear reward: I was eyeing a particular jacket (the Flint and Tinder 10-Year Hoodie, for those interested parties) that cost about $100. It was enough that I wouldn’t normally buy it, but not so expensive that I’d feel bad using it as a college student.

So, my sites were set. Save at least 50% of every paycheck that summer, and I get my new hoodie. It was certainly tough, and money felt tight, but I knew where the finish line was.

My goal that summer made me feel good because I knew I was working toward something concrete.

Most Goals Fail

For most of my life, a vast majority of goals I set never got reached. I’m sure you’re the same way.

You can try with all your might, and you often still come up short. I promise this doesn’t make you defective or a bad person. The reality is that most goals fail.

See, most goals you set were never going to succeed from the start. You didn’t set them up in a way that would even give you a chance of success. 

We tend to romanticize the future and what we’ll be able to accomplish. When you do this, you’ll pretty much always come up short. Goals that are set based on unrealistic expectations are pretty much dead on arrival. They don’t offer you a clear path forward, or a definitive target to aim for, or even a defined end date. When you set your goals this way, you’re setting yourself up for failure.

Goals along the lines of “I want to be healthier,” or “I want to save more money” don’t provide you the steps and accountability you need to succeed. If you’re setting goals like that, you’re setting goals that will only lead to disappointment.

Failure Sucks

I’d be willing to bet that nobody wants to fail. You aren’t intentionally setting goals and making resolutions that are designed to fail. It’s just a byproduct of the default mode of operating. Unless you learn a better way and are intentional about implementing it, you’ll always end up at square one.

And that sucks. One of the most demoralizing things you can do is try hard at something only to come up short. Sure you can shrug it off and say “I did all I could,” but that’s not the same as winning. You can only shrug it off so many times before you begin to internalize it. Your brain shifts from “I failed” to “I’m a failure.”

You aren’t a failure, you just aren’t setting your goals correctly. Goals, whether New Year’s Resolutions or otherwise, should follow a pretty rigid format. Once you learn it, you can stop experiencing the sting of failure. 

That’s my hope for you: that 2020 is the year you stop failing and start crushing your goals. I’ll show you how.

Goals Only Work If You Reach Them

My stepdad loves to make to-do lists. Every day, he gets out a fresh piece of paper and makes two columns. One is for things he needs to do that day, and the other for things that need to get done that week. Then, he starts writing.

He’ll write down a list of 5 to 7 things he needs to do today, and everything else that needs to get done goes on the “this week” list.

The most important step in this process is still to come though: he gets busy. Whether it’s something small like taking a shower or large like driving the hour and a half to my Granny’s house to help her with her computer (both real items from a recent list), he starts moving to accomplish them.

Perhaps most crucially, he returns to his list and crosses off the things he’s done. That’s key. A to-do list is just a bunch of short-term goals, and goals only work if you reach them. By crossing things off his list he’s able to show himself (and my mom) that he has actually gotten a lot done today. That’s a major psychological win that helps him keep pushing forward.

SMART Goals

Next time you start setting goals or thinking about resolutions, remember the acronym SMART. SMART is a framework for setting goals that’s used a lot by businesses but applies just as well to your personal life.

By setting SMART goals, you dramatically increase the chances that you’ll accomplish the things you want to get done. You can finally achieve those things that you’ve wanted to do forever, and chances are it’ll take even less time than you thought when you break them down this way.

Specific

A big reason goals fail is because they’re too vague. For a goal to work, it needs to be specific. That way, you know exactly what you’re working towards and how you’re going about it. Setting a goal to “save money” is too vague. Will it be accomplished when you save 1 dollar? 10? 20? Pick a number as a target for your goal.

When you know exactly what you’re working towards, you can know when you get there. That’s key because you can never reach goals if you keep moving the goalposts. It’s better to set a specific goal, reach it, and then set a more ambitious goal. This keeps your morale high as you achieve more than you ever thought you could.

Measurable

Here’s another big hang-up: your goal has to be measurable. If it’s a super-short term goal like the examples from my stepdad’s to-do list, it’ll be obvious when it’s done. But for anything that’s going to take longer to achieve or involve multiple steps, you must have a way to measure it.

You need to be able to track your progress concretely. This not only helps you stay encouraged on the road to your goal being completed, but it also lets you see if you start to get off course. It will allow you to tweak your strategy early if you notice something’s off. 

This way, you don’t have to wait until the end to see if you got there. You’ll know each step of the way.

Achievable

I think this was often where a lot of my goals used to break down. I’d set goals to achieve things there was no way any rational person would try for. Sure, I might end up getting further than I would have if the goal weren’t there, but I’d never actually get to the goal. This gets old after a while, and you give up on goals altogether.

You need to assess your current situation and set goals that can be achieved in the timeframe you’ve been given. They can be things that’ll push you to or even past your current limits, but they do need to be achievable. 

After all, it’s better to reach your end goal and set a new, loftier target after crossing something off your list than to set a goal so grandiose you’ll never get there. Set goals that allow you to grow and develop, not goals that overwhelm you.

Relevant

In the context of business, this one is easy to establish. Does the goal you’re setting align with your role within your company, as well as the company’s larger vision and market? If it does, awesome. If not, you need to rethink it.

When it comes to your personal life, it can be a little more difficult to decide what a “relevant” goal is. That’s why determining your Hearthstones is so important. When you know what areas of your life matter the most to you, you know what’s relevant.

Your goals should align with your Hearthstones. You want to prioritize those things, and you need to set goals that help you improve them in some way. They may be about being able to spend more time there, or they may be about minimizing the amount of time you have to spend on other things. Either way, if a goal helps you get closer in line with your Hearthstones, it’s a relevant goal. You know you won’t feel bad or stuck when you reach it, as can happen with goals that aren’t relevant to the things you care about.

Time-Based

This is where so many goals go off the rails. Every goal you set needs to have a time limit. By binding your goals within time, you create accountability and help make sure you get things done. New Year’s Resolutions are so great because they do this automatically: they are year-long goals.

Every goal you make should either have a time (“for the next 3 months I will…”) or a due date (“By March 15th I will have…”). By setting your goals this way, you can combat the procrastination that often keeps us from reaching our personal goals. We get things done when our boss needs them at work, but we don’t apply the same deadline mentality to our own goals.

Notice how each section of this SMART framework applies to my goal to buy a new hoodie if I saved 50% of my income all summer long. And for those of you wondering, I still wear that hoodie to this day.

Set deadlines on your own goals, and you’ll find yourself achieving the things you’ve always wanted.

Want to get a few ideas about setting SMART money goals in the New Year? Subscribe to my email list to get Part 2 of this article: “Personal Finance Goals You Can Conquer In 2020”

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