Setting SMART Financial Goals

Most people set financial goals with good intentions - “I’ll save more,” “I’ll pay off debt,” “I’ll invest for in my retirement account.” But vague goals don't get results. The secret to achieving your financial goals is turning them into SMART goals: Specific, Measurable, Achievable, Relevant, and Time-bound.

Here’s how to put that into practice:

1. BE SPECIFIC

Vague goals like “I want to save money” don’t give your brain a clear target. Specificity creates focus so the more detail you add (what, why and how), the easier it is to stay motivated. Each goal should answer the 5 W's:

What exactly do you want to achieve?
Why is this goal important to you?
Who is involved (just you, or your family too)?
Where will the money go (a savings account, investment, debt payoff)?
When do you want to start?

For example:

Define the exact purpose of the money. Is it for an emergency fund, a vacation, a car, or retirement?
Write it down in plain language: “I want to save $5,000 over the next 12 months for a vacation to Italy in June 2027.” "I will pay off my $2,500 credit card balance by December 31st by making an additional $250 monthly payments over the next 12 months, skipping June and November." Or "I will invest $200 per month into a Roth IRA account on automatic draft starting January 1st."

2. MAKE IT MEASURABLE.

If you can’t measure it, you can’t track your progress. Use an app, spreadsheet or a notebook to chart your progress and keep it motivating. Example:

Attach a dollar amount or percentage.
Break it into smaller chunks. For example: “Save $5,000” becomes “Save $400 per month for 12.5 months.”
Use tools: budgeting apps, separate bank accounts, spreadsheets, or even a simple envelope system.
Check in at 90 days and 180 days to see if you are on track - can you contribute more, or did you have an unexpected expense you need to adjust for?

3. KEEP IT ACHIEVABLE

Goals that are too ambitious set you up for disappointment. Achievability balances ambition with reality. If you start smaller than you think, you can always increase your target later.

Look at your income and expenses honestly.
If saving $400/month isn’t realistic, scale back to $250/month and extend the timeline.
Build in a plan and flexibility for unexpected expenses.

4. IS IT RELEVANT?

If a goal doesn’t connect to your values, it won’t stick. Relevance makes the goal meaningful and if motivation dips, you have something to revisit.

Write down your answer to the question: “Why does this matter to me right now?”
Align goals with your life stage. A college student’s goals (paying off loans, building credit) differ from a parent’s (saving for a child’s education).
Prioritize goals that reduce stress or increase joy.

5. MAKE IT TIME-BOUND

Deadlines demand you pay attention to your goals - without them, they drift into “someday.” Here's what to do next:

Set a clear end date: “Save $5,000 by June 2026.”
Break it into checkpoints: monthly or quarterly reviews.
Use reminders—calendar alerts, sticky notes, or accountability partners.

You can also pair deadlines with rewards. For example, when you hit the halfway mark, treat yourself to a small celebration.

PUT IT ALL TOGETHER

A vague goal would be: “I want to go to Italy.” A SMART goal is: “I will save $5,000 for a vacation in Italy by June 2027. I will set aside $400 each month through automatic transfers from my bank account to the Vacation Savings account I will set up by Friday.”

REVIEW AND ADJUST

Life changes—so should your goals.

Review monthly: Are you on track?
Adjust if needed: Increase contributions as a fixed dollar amount of percentage when you get a raise, or extend the timeline if expenses rise.
Celebrate milestones: Every $1 saved is a win.

FINAL THOUGHTS

SMART goals transform financial planning from wishful thinking into a step-by-step roadmap. At the end of the day, setting financial goals isn’t about being perfect or having everything figured out - it’s about giving yourself a clear direction and a plan you can actually stick with. The SMART framework works because it forces you to get specific, put numbers on the page, and set a timeline that keeps you accountable.

Think of it this way: your money is like a car. If you don’t tell it where to go, it’ll just sit in the driveway. But when you set a clear destination, map out the route, and check your progress along the way, you’re much more likely to actually arrive. Small, consistent steps will add up faster than you think.

So don’t overcomplicate your financial goals. Pick one goal, make it SMART, and start today. A year from now, you’ll be glad you took that first step.

The opinions expressed and material provided are for general information, and are not intended to provide specific advice or recommendations for any individual. Nothing in this publication shall be construed as providing investment counseling or directing employees to participate in any investment program in any way. Please consult your financial advisor or other appropriate professional for further assistance with regard to your individual situation.