Making This Your Year of Change with SMART Goals

February 6, 2018 - 9:18am

If one of your priorities in 2018 is getting your debt and finances under control, it helps to set a goal.

The advantage of getting started now is that you have an entire year ahead of you to reach your goal. A very popular goal setting approach is creating a SMART plan (Specific, Measurable, Achievable, Realistic, Timely). Here’s how you create a SMART goal:

* Specific: What you are looking to accomplish? For example, you may want to pay back one of your student loans, reduce your credit card debt with the highest interest rate, or start an emergency fund.

* Measurable: How much do you want to pay down, or save? For example, you may decide to repay half of your remaining student loans, or save $85 a month for emergencies. Did you know that by saving $85 a month, you would have a little over $1,000 saved in one year?

* Achievable: Will you be able to complete your goal? For example, if you plan to pay back a student loan, confirm what the exact amount is and how you plan to accomplish your goal. Don’t set a goal that is too difficult to achieve, make sure it’s realistic.

* Realistic: Are you financially comfortable with your goal? For example, if you have other financial responsibilities to consider such as rent, or a car payment, set an amount that you will truly be able to commit to, without feeling overwhelmed or stressed.

* Timely: How long will you need to accomplish this goal? For example, in one year I will have reduced my student loans by half, or at the end of the year I want to have $1,000 in my emergency fund.

Once your SMART goal is set, allocate some time each week, or each month to review your progress. If you find, at given time, that you weren’t able to save or pay down as much as you had planned, try to make up the difference in the remaining time you have to still reach your end goal. A great way to add to your savings or pay back a loan is by setting up automatic payments. You never really have to think about it, the work is done for you.

The key to setting short or long-term goals is understanding it will take time and dedication, but when you stick to your plan, the end result will be worthwhile.

Keep an eye out for my column for more debt solutions. What’s your financial goal in 2018? Join the conversation. #DebtSolutions #NewYearsResolution #NewYearMotivation

Debt Solutions
By Jasmin Brown Licensed Insolvency Trustee, BDO Canada Limited

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