The material presented here is for educational purposes only, and is not intended to be used as financial, investment, or legal advice.
3 Small Steps to Reaching Big Money Goals
If you’ve ever set a big money goal for yourself — like saving up cash for a down payment on a new home or paying off debt — you know how hard it is to stay on track. You start out strong, budgeting like mad and saving every extra dollar. Cut to one month later and you’re sitting on your couch browsing online shopping sites with your digital wallet in (virtual) hand while binge-watching crime shows on five streaming subscriptions you don’t need.
Don’t worry, you’re not alone! Recent studies1 have shown that only a quarter of people stick to their New Year’s resolutions longer than 30 days. How many goal-setters actually reach the finish line? Just 8%. In fact, according to athletic social networking company Strava, the second weekend in January marked the date when most social media users reported failing at their goal.2
Still, there’s hope! Here are three simple steps that you can take to ensure you’ll hit your mark:
1. Think Small:
Instead of focusing on a major achievement like “save $30,000 for a down payment,” break your goal up into smaller, more achievable tasks. Keep the focus on your daily to-do list and you’re more likely to make measurable progress.
For example, your first step for major money goals like saving up for a house or buying a new car could be scheduling bi-weekly direct deposits into a separate savings account set up just for this purpose. If your big money goal is to pay off your credit card debt, you could begin by paying an extra $50 this month above the minimum payments you’ve been making. By staying focused on smaller goals, you’ll avoid getting overwhelmed too quickly.
2. Keep Moving Forward:
If you make a mistake, don’t beat yourself up for it. Maybe you splurged on a new video game or a fabulous purse and didn’t put that money toward paying down your debts this month. That’s OK! Remember, most New Year goal-setters missed at least one step by mid-January.
The important thing is that you get back on track and plan how you’ll save next month. If you can, make up for a misstep by cutting out your weekly movie trip or eating at home instead of at restaurants to save extra cash.
You might also have to revisit your monthly budget and make changes that work better for you. Don’t have a budget already in place? Check out our budgeting tips for beginners and download the free worksheet.
3. Find Your Goal Mate:
Research shows that accountability is a key factor in achieving goals. A study by the American Psychological Association showed that having a partner or coach monitor your progress increases your chances of success.3 You don’t have to hire an expert to fill this role, though.
Consider talking to like-minded friends who are working toward their goals. But be selective about the “goal mates” you choose. It’s not enough to just get words of encouragement. If you truly want to reach your big goal, your partner or support team has to hold you accountable for meeting your mini goals.
Finally, you’ll want to keep a log or written record of your progress. Not only will it enable you to track how you’re doing, but you’ll also be able to share this info with your support team so you can stay accountable.
By breaking your end goal down into smaller chunks, quickly getting back on track if you fall off, and building a support network, you may soon find yourself in that lucky (and extremely hardworking) 8% of people who reach their goal. Then all that’s left to do is … celebrate!