NDSU Extension - Mercer County

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Set Financial Goals as Your New Year's Resolution

setting financial goals, financial goals

Submitted by Dena Kemmet, Extension Agent/Family and Community Wellness

Did you know, the average median household income in Mercer County (2012-2016) is more than $18,000 higher than the national average? With the new year upon us, millions of people are coming to terms with which resolution goals they will attempt to keep this year. Why not make one of your goals to have a healthier financial year?

Setting financial goals is a great way to figure out how you want to spend your money. Sometimes this decision is driven by a life event such as a wedding, graduation, vacation or other wants versus needs for large purchases.

It is important to have a mixture of short-term, intermediate and long-term goals. Short-term goals are those you can fulfill in three to six months, intermediate goals are those that can be met in six months to one year, and long-term goals take longer than one year to achieve.

Achieving a small goal, such as a short-term goal, can help you stay motivated to reach your long-term goals.

Working with everyone in the family is essential when setting your goals. If everyone is working toward the same end in mind, it will be easier to achieve.

Set SMART (Specific, Measurable, Achievable, Realistic and Time Bound) goals. Remember, a goal without a plan is just a wish. Being specific with your goal will help you determine if it is a possibility.

Here is an example of a goal versus a SMART goal:

Goal: I want to take a vacation this year.

SMART Goal: I want to take my family of four to Florida in nine months. I will need $3,000 and will need to put $335 in savings every month.

In the example, the SMART goal is very specific and this person knows exactly what needs to be done to reach this goal. However, it still may not be a SMART goal if this individual can’t afford to put that amount of money in savings every month (it wouldn’t be attainable). It may still be realistic, but instead may be a long-term goal because it would take longer to achieve.

Write your goals down where you can see them on a regular basis. Reminding yourself what you are working toward can be a great motivation.

Once you have met a goal, celebrate! It may be something small, but keep finding ways to appreciate the effort you have put into reaching a goal. Maybe it’s renting a movie and having a movie night at home. It doesn’t have to be big.

If you find that you don’t have enough money to fund your goals, you could re-evaluate your budget to see if there are places you can cut some of your expenses.

To learn more about how to set financial goals and follow a spending plan, download the North Dakota State University Extension Service Family Money Manager publication at http://bit.ly/NDSUMoneyManager.

Source: Carrie Johnson, NDSU Extension Service personal and family finance specialist
https://www.census.gov/quickfacts/fact/table/US/PST045216

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