How to Set SMARTER Financial Goals

New year, fresh start! 

As 2023 is just right about the corner, you may be thinking about how you can spend less and save more. And while setting the intention is a great first step, the most important part is actually following through with the plan beyond January.

New Year’s Syndrome

Human as we are, many of us suffer from a condition known as New Year’s Syndrome, where we set goals once a year and then completely forget about them. Research shows that 30% of those “new year, new me’s” give up on their resolutions by the 2-week mark, and only 8% of people actually get to achieve their New Year’s goals.

Just in case you’re one of those who has resolved to “save more money” every year but totally slipped up before January ended, fret not. It doesn’t mean you failed. You can certainly come back from it. And here’s how you can do it: Start by setting SMARTER goals.

Set SMARTER Financial Goals

We often hear about setting SMART goals: Specific, Measurable, Achievable, Relevant, and Time-Bound, right? We can certainly make it smarter by adding the two extra letters: Evaluated and Revised.

So paano nga maging SMARTER yung goals natin?

S- Specific 

Make your goals specific. What do you really want? Be very detailed kung ano yung gusto mong ma-achieve this year.

Your goals need to provide you with clarity and a concise aim as to where you are going. Kasi kapag sinabi mong “I want to buy a house,” malabong mangyari. Bakit? Kasi hindi klaro yung goal na yun. Masyadong vague.

Paano gawing mas-specific ang goal to buy a house? Think about what exactly you want in a house. Saang area mo ba gusto? Dapat ba malapit sa workplace? Do you want some outdoor space for your furbabies? Do you need a large kitchen space? Identify your non-negotiables vs. your nice-to-haves.

If you’re saving up for your kids’ education, consider if you’d like to enroll them in a private or public school. Would they need to be in an apartment?

If you’re building your retirement fund, think of how you’d enjoy your retirement years. What’s your lifestyle like by then? Will you travel a lot? What’s your retirement home like? Do you plan to spoil your grandkids rotten?

Clearly visualize your goals, so you can hatch a plan to achieve them.

M- Measurable. 

Build measurable goals. Understand your financial capacity. One of the most important tools for achieving success is measurement. As they say, you can’t improve something that you can’t measure. Begin by keeping track of your income and spending, existing debts, and current savings. You may then establish measurement milestones from there.

For example, if you’re hoping to save ₱50,000 within a year, you can set a target of ₱25,000 after 6 months or ₱4,167 per month. You can even set a weekly target of (~₱1,000) or ₱200 every weekday. While the overall goal may seem huge and overwhelming, breaking it down to ₱1,000 weekly makes it more doable, right?

A- Achievable. 

Motivate yourself with attainable goals. Are your goals realistic? Is it possible for you to achieve them in the time allotted? We’d very much like to dream big, but that isn’t always the case. Make your goals big enough that you can push yourself to attain them, but don’t make them impossible to achieve.

R- Relevant. 

Your goals should be relevant. Where do your current goals fit in your life goals? Your financial goals should be relevant to the direction you want your life to take. Your short-term and mid-term plans should align with your long-term vision.

T- Time-Bound. 

Stay focused with timely goals. It might be helpful to define deadlines for each step of your identified milestones. Instead of just stating, “I will buy a house this year,” it will be much better if you get a little more specific:

• I will narrow down my search area to 3 areas by March.
• I will find a real estate professional by May.
• I will establish my home budget by September.
• I will start house hunting by October.
• I will pay the downpayment by December 2022.

E – Evaluated

Take time to evaluate your goals. Instead of just winging it and expecting to reach your new year’s goals at the end of the year, it’s a good idea to regularly assess your goals. Review and reflect on your goals to help you stay focused all the way along the process.

R – Revised.

The final aspect of using the SMARTER technique to define goals is to re-adjust your approach as needed. If, for example, you’re chasing a goal but keep hitting a brick wall, try changing your method. Readjusting or revising your goals doesn’t mean that you have to throw your plan and begin again. It means that you must experiment with different ways until you find yourself coming closer to achieving your goals. That is why it is critical to evaluate yourself regularly, whether it’s weekly, monthly, quarterly, or annually.

In case you’re getting overwhelmed thinking of a goal for this year, here are a couple of examples.

Example Goal #1

Start a side hustle that makes ₱25,000 by the end of the year.

How to achieve this goal: Do a personal skills inventory. List your skills, education, experiences, and available resources. Better yet, do a personal SWOT (strengths, weaknesses, opportunities, threats) analysis. This will help you understand what you’re good at and the opportunities available to you. Find a side hustle that can make at least ₱25,000 per month each month based on your SWOT. Whether it’s through freelancing, a home-based food business, or buy-and-sell you want to pursue, stick with your decision. Don’t spend an entire month (or two!) figuring it out.

Side hustle ideas:

• Virtual assistant
• Social media marketing
• Selling printables
• Affiliate marketing
• Be a financial advisor

Example Goal #2:

Save enough money to have an additional ₱40,000 in an emergency fund by December 2022.

How to achieve this goal: Set a monthly budget and include ₱3,333 per month to go into your emergency fund. You can do this through ipon challenges, invisible bills challenge, or automating your savings.

Oh, don’t forget to sign up for the free resource library and get exclusive access to free printables, planners, and spreadsheets related to making, saving, and managing your money! There’s a printable goal sheet you can hang on your workstation.

My Personal Goals [2022]

Might as well share my personal goals here for accountability.

Goal #1: Increase my income by ₱15,000 monthly on June 2022.

With many businesses struggling due to the pandemic, I, unfortunately, lost a client. This meant a reduction in my income. Ideally, I should have looked for another client, but I wasn’t in the proper headspace last year to actively look for one.

To achieve my goal #1, I have reached out to my existing clients to (a) increase my rate and/or (b) ask for referrals so I can have at least 1 additional retainer client for my digital marketing business.

Goal #2: Save up ₱100,000 by December 2023 for my annual dues.

I’ve calculated my dues for my personal insurance and business expenses (as a blogger), and it amounts to around ₱100,000 annually. I wanted to have that amount in liquid assets (cash or near-cash) by the start of each year so I wouldn’t have to stress about keeping up with the due dates for the rest of the year.

While I would love to have that amount by this year, I think it would be more realistic to aim for half of that by this year, and the remainder by 2023. This means I’ll save ₱4,000 monthly for this. That may mean I need to increase my income and decrease my budget for eating out (and deliveries) and online shopping!

Goal #3: Secure 20 families by December 2022.

To be perfectly honest, I applied as a financial advisor last year just for the financial education I would get. Yes, there are a lot of resources online, but I wanted more structured learning. Haha! I didn’t plan to do this for a living. I thought I’d just go through the training; I wasn’t even sure I’d like to take the licensure exams.

I had 2 insurance policies when I applied, but I admit I didn’t fully understand them — not because the agents were bad, but maybe because I didn’t know what questions to ask. During the training and review, I had a loooot of learning that I really wanted to share with a lot of my fellow Filipino freelancers. I wanted more families to manage their money better.

I got my license in October of last year, and by December 2022, I aim to secure 20 families. Well, 20 may seem like a lot of clients for a newbie like me, but once I break it down into smaller chunks, 20 clients is just 5 per quarter, or 1-2 clients per month.

[Shameless plug]: Book a free financial planning session with me. I promise you’ll learn something that will help you sleep better at night! 😎

If you need help in hatching a plan for your goals, feel free to contact me via Facebook, Instagram, or email.