What is S.M.A.R.T.?

Specific – be clear and specific about what you want to achieve

Measurable – ensure you can measure progress and success

Achievable – identify the achievable steps you need to take to ensure success

Relevant – your goal needs to be relevant and meaningful to your life

Time-bound – identify the start and finish dates for each step and goal completion

Finding your way

There are 2 types of financial goals: needs and wants.

Needs: These goals should take priority! E.G. new school uniforms.

Wants: These are the nice to have goals. E.G. pay-off two personal loans.

Identifying the goals associated with needs vs wants will ensure you prioritise your money in the right places. It’s OK if you need to tweak or change goals associated with our wants along the way. BUT if you ‘drop the ball’ on your goals associated with needs it could create an environment for a financial shock!

An example of a Need Goal: to buy school uniforms

Specific – to buy school uniforms for my daughter and son

Measurable – they will either have new school uniforms or they won’t

Achievable

  1. Identify school uniform costs
  2. Identify any money already put aside for this purchase
  3. Complete Love My Money’s Saving Up for Spending Journey to get an action plan so I know how much money I need to set aside every month
  4. Use the action plan to set up regular money transfers to a dedicated account for school uniforms

Relevant – my daughter and son need school uniforms to attend school

Time-bound

  1. Identify school uniform costs by 17/4/20
  2. Identify any money already put aside for this purchase by 17/4/20
  3. Complete Love My Money’s Saving Up for Spending Journey to get an action plan so I know how much money I need to set aside every month by 20/4/20
  4. Use the action plan to set up regular money transfers to a dedicated account for school uniforms by 22/4/20
  5. Complete savings goal by 15/1/21
  6. Purchase school uniforms by 22/1/21.

An example of a Want Goal: pay-off two personal loans

Specific – pay-off two personal loans as quickly as possible

Measurable – I know how long it will take if I pay the bare minimum and I know what the bare minimum is. Paying my debts off sooner will be a success, as I will save money and time.

Achievable

  1. Identify current outstanding debt and interest rate
  2. Complete Love My Money’s Get on Top of Short-term Debt Journey to see and understand how Cascading Payments and additional payments can help me get out of debt as quickly as possible
  3. Use the Get on Top of Short-term Debt Journey action plan to set up repayments I can afford.

Relevant – the sooner I pay-off debt, the more money and time I save to do other things with

Time-bound

  1. Identify current outstanding debt and interest rate by 3/4/20
  2. Complete Love My Money’s Get on Top of Short-term Debt Journey to see and understand how Cascading Payments and additional payments can help me get out of debt as quickly as possible by 6/4/20
  3. Use the Get on Top of Short-term Debt Journey action plan to set up repayments I can afford by 9/4/20
  4. Repay all debt by 5/12/20 (saving $550 in interest and 3 months in repayment time)