Every year, millions of individuals set personal and professional goals for their New Year’s resolution. Unfortunately, most people have a hard time sticking to their resolutions, maybe because they’re too big, too hard to accomplish, or ultimately because there’s not a good enough reason to continue on.
How to set financial goals
The first thing you have to do in order to set financial goals is to understand the types of financial goals that are available to you. You could choose long-term financial goals like saving for retirement or short-term goals like paying off credit card debt. These are just a few financial goals examples and there are many different types, styles, and beliefs when it comes to financial habits and financial goals.
We compiled a list of 20 money-related goals that are within your reach and will change your financial future if you are able to hit—or exceed—them.
Goals to set in 2020
- Make a spending plan
You’ve heard it once, you’ve heard it 100 times: You need to make a budget. 2020 is the year, no, the decade, to forget about a budget, and make a spending plan instead. Know your financial inflows, and think about where you want those funds to go: for instance paying down debt and paying yourself first.
- Stick to the spending plan
This part is a little bit harder. Most of us are able to create a one-time spending, but editing it and sticking to it is one of those long-term financial goals that may be a bit more difficult. We recommend starting small and going month by month instead of focusing on the entire year.
- Pay bills right after payday
This will prevent you from being surprised or unprepared when bills roll around. You could also set bills up on autopay as well, which can help streamline your finances and keep you on track toward a better financial future.
- Pay yourself first
Or in other words, save money before you ever have time to spend it. Once you start to consider saving money (whether it’s for retirement, an emergency, or a treat yourself fund) as paying your future self, the easier it will be to continue on that road and not feel like you’re losing money.
- Do a financial 30-day challenge for one month
There are hundreds of 30-day challenges that you could do: Whole 30, get more sleep, eat more veggies—the possibilities are endless! But by setting a goal to go 30 days with or without something and then sticking to it will help kickstart your resolutions and give you the confidence you need to tackle whatever comes your way. For instance, perhaps you dig through your pantry and make meals based off of what is in there so by the end of the month your grocery bill is a bit lower because you’ve used what’s already in stock in your home.
- Eliminate high-cost debt
While we understand that paying off debt isn’t always something that can be done immediately, there is a smart way to tackle your debt that can help you feel more motivated and secure leading into 2021. High-cost debt is debt that has high fees or interest loans that’s costing you more in the long run, usually credit card debt. Put any additional money that you have to pay down debt on these types of debt first.
- Improve your credit report
Set a goal to improve your credit score. It can be by checking your report and making sure all entries are accurate and/or making sure to pay every bill you receive on time in 2020, but whatever it is, give yourself a reason why you’re aiming toward that and set a clear path to do so.
- Fully fund your emergency fund
2020 is the year to finally have a fully-funded emergency fund! The rule of thumb is to have an emergency fund that is separate from retirement funds or savings funds that is at least three times your monthly salary. It’s separate from other types of funds because it should be able to be used for emergencies and not impact your other financial goals.
- Track your spending for one month
For just one month, write down every single dollar that you spend. You will be shocked at the end of the month to see where your money is going. And you may be inspired to continue on for another month as well. In our Richer Retirement course, we provide a template for doing just this.
- Pay for a vacation with funds earmarked for vacation
This is a big goal—but one that is a great habit to set for future vacations. Saving money for vacation is one of the easiest things to save for because most of us love vacations and understand the value they bring. Having cash on hand to pay of the vacation before going on the vacation can ensure that you don’t have any guilt for enjoying some time to yourself or with family.
- Consider diversifying your income
Is there a way you can earn even just $500 extra dollars in 2020? Maybe you have the ability to write guest posts for one of your favorite websites, drive for Uber or Lyft, or just clean out your closet and sell items online. No matter what it is, diversifying your income is a great way to expand your net worth and keep you on the path toward a stronger financial future.
- Cook more at home
According to Forbes, it is five times more expensive to order delivery from a restaurant than it is to cook at home. Every year, we tell ourselves that we’re going to finally start eating at home more. Make it a goal and stick to it! Start looking up new and creative recipes to inspire your cooking and keep it interesting, even when your favorite restaurant is calling your name.
- Review your beneficiaries
You should review your beneficiaries every single year! If it is time to update your beneficiaries, either because of changed planning such as divorce or death, it’s as easy as logging into your account and putting in new information. Without adequately identifying beneficiaries, your assets will be sent to and divvied up by the state.
- Create a will if you haven’t yet
On that same note, it is time to finally create a will! Some people think that a will is only for rich people, but it is actually something that every single person—married, single, parent, or child-less—should have in place. Ultimately it will help provide organization and be a breath of fresh air in the case of your death, giving your family one less thing to worry about. Think about this as your last gift to your loved ones.
- Learn a new skill
Learning a new skill is a great way to improve your personal and professional life. Maybe you dedicate yourself to learning something new at work or taking a professional development course. Or maybe you’ve always wanted to learn how to crochet. Whatever it is that interests you, take the time to actually devote yourself to the learning process this year and see how your mind and opportunities grow alongside you!
- Improve your physical health
In his book Who’s Afraid to Be a Millionaire? financial journalist Kelvin Boston says, “your health may determine your wealth.” According to Boston, the biggest impact on economic wealth when it comes to health is the impact of preventable illness, like diabetes or hypertension. Take the time and effort to see where your physical health can be improved in 2020 and set yourself up for a stronger financial foundation.
- Eliminate expensive habits
If there is something that you pay for routinely, like smoking, or paying for a too expensive gym membership that you never use, it may be time to see where you can eliminate or lessen that debt. There are more affordable gyms and habits that have less of a long-term impact, financially and physically.
- Start a gratitude journal
If someone asked you today what you’re grateful for, would you have an answer? Simply reflecting every day in a gratitude journal is a great way to keep your blessings top of mind every day. In our Richer Retirement course, we incorporate gratitude into financial planning as a way of inspiring motivation and reminding us that there’s more to life than a high bank account.
- Read a financial book/blog – You don’t have to know everything there is to know about personal finance on January 1, 2020. Subscribe to a financial newsletter or pick up a book from a financial expert and give yourself the grace to learn as you go.
- Start a treat-yourself fund
If you aren’t able to treat yourself with the money you’ve saved, why save at all? Give yourself a little freedom in your finances and start a treat yourself fund! You can save small at first, just $5 or $10 a week, and watch it grow. Wait until it’s a good size and then treat yourself to something you’ve been eyeing, like a new laptop or a fancy purse. Treating yourself is a great way to celebrate financial wins and saving for the moment is a great way to stay on track.
We hope these financial goals and financial New Year’s resolutions have inspired you on your path toward financial wellness! If you’re looking for a partner to help you along the way, reach out to our team about our online financial coaching or online financial education classes.