Make S.M.A.R.T. Budget Goals



We all have financial goals we want to achieve and the best way to do that is to write them down and track your progress. It is hard to be successful at something we are not paying attention to. It is no different with our money. If we want to win with money and live a life of our priorities then we need to set smart goals. We have all heard of the S.M.A.R.T. goal setting method and this method can be applied to your financial goals as well.


What is the money for? Which category are we going to allocate these dollars to? While we don’t want to get too bogged down in the details of our day to day spending we also want to make sure our categories are not too broad as to hide our true expenses.


How much money do we want to have in this category? We only get a certain amount of money each month that needs to be divided between our categories. After our basic necessities and savings, what are our priorities? We should also be looking ahead as some categories will need a lot of money, more than we may make in a month. Setting aside a specific amount each month will help us get to our goal.


Is this realistic based on the amount of money you make? Planning ahead is key as the more time we give ourselves the more attainable the goal will be. We don’t want to wait until December to start setting aside money for Christmas. If you want to go on a nice vacation next summer, start setting aside money now each month. Get ahead of your spending with sinking funds, don’t make monthly payments (with interest) on the vacation you took last year.


Budgeting is supposed to help us reach our financial goals and live our priorities. Does this align with our priorities? Is it worth saving for? Does it help us get closer to our financial goals?


When will you meet this goal? Like we stated earlier, planning ahead is key to being successful with our goals. We only have a finite amount of money each month, so planning ahead and breaking down large expenses into smaller bites will give us a better chance at success and help us avoid going into debt.

Using the S.M.A.R.T. goal setting method and applying it to our budget will help us to make more realistic and achievable goals. Like any skill this will take time to hone in before we are good at it. Be persistent and give yourself grace while you hone your skills. This will ultimately help us to win with money and to live a life of our priorities.

George Doran, Arthur Miller and James Cunningham in their 1981 article “There’s a S.M.A.R.T. way to write management goals and objectives”

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