Ask someone what her top financial goal is, and she’ll likely say, “spend less money.” Ask why, and she’ll say something like, “to pay down credit cards,” or “I need to save more.”
Isn’t it more than that though?
It’s because she feels strapped, or wishes she had her own home, or wants to travel now, while she’s young and child-free. Capturing the ‘reason behind the reason’ is the key to motivating yourself to reach a financial goal and resist temptations that derail you.
How do you do that?
- Write down three goals that are important to you.
The act of physically writing goals is more powerful than you think. Fewer than 20% of people say they do that. Research shows the act of writing helps to encode things in your long-term memory, which is why even if you write down a goal and never look at it again, you’re still more likely to achieve it. But having a tangible document to review throughout the year also is a simple way to remind yourself what’s important to you.
2. Now, get more specific.
You’ve probably heard of SMART goals – Specific, Measurable, Action-oriented, Realistic, and Time Bound – but if that feels too complicated, write CAN goals:
- Concrete – written clearly; outline what you want to accomplish and when
- Aspirational – something you truly care about; it impacts you emotionally
- Nudgeable – small, actionable steps you can take starting now.
Example: “Reduce my credit card balance by $2,000 this year by saving $40 every week.
3. Add your Why in vivid and emotional language.
Describing your goals vividly and emotionally multiplies the impact of writing them down. One study of young adults who felt stressed about taking a math exam found that if they paused to write about their anxiety about the upcoming test, they performed better – perhaps by distracting themselves from their emotions and allowing them to focus.
What does this look like in action?
| My Goals | My Whys |
| Reduce my credit card balance by $2,000 by December by saving $40 a week. | This debt stresses me out and makes me feel underwater. It prevents me from saving for a downpayment on a home, which is what I really want, and it’s costing me almost $100 a month in interest charges. If I eliminate one food delivery order a week, I can make a huge dent in my debt. |
| Save $5,000 toward a home downpayment by December by cutting $100 in weekly expenses or finding a side hustle that pays $420 a month | I’m tired of paying $1,800 in rent a month – that’s almost $22k in a year! I want to own my own home so I can paint walls, plant a garden, and build value in the real estate market. A roommate could help me offset costs. |
| Save enough in my 401k plan to earn the 3% company match by setting up a payroll deduction. | My company’s match is basically free money and I can get a tax break by saving for retirement in a 401k. I’m lucky to have that option. It will make me feel good to know I’m saving for longer term goals and can start investing while I’m young. |
Before you start building a budget or slashing subscriptions, take 30 minutes to put the power of written goals to work. You’ll be far more likely to reach your goals and resist temptation because you know WHY you’re making hard choices and HOW you’ll get started.