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Setting Realistic Goals for the New Year

Whether you are preparing to set personal finance goals for the new year, or whether you have other goals in mind, the hardest part seems to be achieving success. Indeed, many of us set forth grand aspirations for the coming year — only to have those hopes dashed relatively early on. The problem is that, in many cases, we fail to set realistic goals.

While there is nothing wrong with dreaming big, someone with $30,000 in debt, and a low-paying job isn’t going to achieve financial freedom in eight months just because it’s a goal. You’re not going to lose 20 pounds in six weeks, and, even if you do manage to lose the weight, keeping it off is going to present its own challenges.

The key is choose realistic and sustainable goals for the new year. Here are some tips that can help you set realistic goals for the brand new year:

Choose Something You Really Want

A realistic goal has to be something that is truly important to you, and it has to be something that will give you satisfaction to accomplish. Consider your priorities and values, then choose a goal that you would be really motivated to achieve. You will be more likely to work toward this goal with the proper incentives.

Pick Only One or Two Things to Focus on at a Time

It’s not realistic to think that you will be able to accomplish 20 goals, working on them at the same time. That’s a short road to complete burnout. Instead, pick one or two really important items to focus on first. You can create a list of additional goals to tackle once your initial goals are accomplished, but don’t try to do too much at once. Improve one area at a time, and you will make better progress.

Define Your Goal with Actions

Don’t just define the end result that you want to achieve. Specificity can help you accomplish your goals, measure progress, and create a plan that will sustain you throughout the process. Use actions to help you define your goal. If you want to cut spending, choose specific actions that will help you do that. “Cut spending by 20% each month” can be a goal boosted by measuring actions, such as “brown bag it three times a week” and “eat out only twice this month.” These are mini-goals that help you achieve your larger goal, and that can help you stay on track as you see that you are making progress.

Recognize that You May Not Always Stay on Track

As you are setting your goals, realize that you might not always accomplish them perfectly. Your goal isn’t destroyed if you get off track a little bit. Breaking up your goals into bite-sized pieces can help you get back on track more easily if you fall behind. Remind yourself that you can take a deep breath and start back on the right track tomorrow. It’s important to set goals that allow you to tweak the time frame so that you aren’t giving up at the first sign of trouble.

What are your tips for setting realistic goals?

(Photo: Sean MacEntee [3])