Have one main SMART financial goal for 2023 and stick to it no matter what

For 2022, I set two goals in mind, one health related while the other was about money. In fact the second one was a mix of both:

Health: to do 10 push-ups a day, and increase it by 1 with each new month, so by December I was doing 22 push-ups a day. I stuck to this for the most part and rarely skipped any days. In fact, for Dec 31, 2022, I made sure to do 25 pushups to end the year on a great note and declare this goal a great success. Not only that, but having turned this into a routine and daily habit, I plan to continue to do this for the new year.

Wealth: I decided to skip most junk food purchases other than once a week (possibly twice at max) and put all the saved money into a piggy bank or an emergency fund. This alone helped me save close to $600.

Notice how both goals were easily defined and measured? In other words, I could easily know whether I succeeded or failed. My goals weren’t ‘to do pushups’ or ‘eat less junk food outside’ since these are not easily measured or able to compare to the alternative.

With 2022 now behind us and a new year to work with, if you haven’t already set a resolution or goal, no worries, you still have time. What matters is that you have a good goal, define it well, and stick to it no matter what. That is, you need to set clear SMART goals, with clearly defined OKRs. As some of you may know, SMART when it comes to goal settings stands for:

  • Specific: Well defined, clear, and unambiguous
  • Measurable: With specific criteria that measure your progress toward the accomplishment of the goal
  • Achievable: Attainable and not impossible to achieve
  • Realistic: Within reach, realistic, and relevant to your life purpose
  • Timely: With a clearly defined timeline, including a starting date and a target date. The purpose is to create urgency.

With that in mind, here are some ideas to get you started with goal setting for the new year:

-Objective (goal) : save $5,000
Key Results (metrics that will help you get there): save around $199-200 from every paycheck (assuming you get paid biweekly) . If possible, you can save some from your salary and the rest to come from other sources.

-Objective (goal) : Reduce your total debt by 50%
Key Results (metrics that will help you get there): Start by ensuring you are not putting any more debt that you can’t cover immediately. Next, depending on your balance, you need to determine what 50% of that is, and then work backwards. For example, if your balance is $10K, then you know that 50% of that is $5K, so you need to come up with a plan to pay that off in 12 months. You can make it even simpler by deciding how much of that will come from your salary. Let us assume you dedicate $150 bi-weekly to tackle this amount, that works out to $3900 a year, meaning you need to come up with the balance of $1100 from other means, be it from your savings, work bonus, take on an extra side gig etc.

-Objective (goal) : Reduce amount spent on dining out to just $100 a month
Key Results (metrics that will help you get there): Simplify this by setting this $100 amount on the side at the beginning of each month and stick to it. If you blow through it all within the first week, well too bad, that would be something you have to live with. And believe me, it will feel good when it is the end of the month and you managed to only spend what you agreed to.

-Objective (goal) : Drive less to save on gas
Key Results: Start by making note of any unnecessary trip that you take and eliminate or reduce it. For example, if you go to multiple grocery stores that are more than 5 KM apart from each other, try combining them into one trip to one or max of two stores. If your commute to work is a long one, speak to your manager about working from home at least 1-2 days a week. While the amount of mileage we drive differs from person to person, one way to determine this in order to set a specific goal is to measure what your annual mileage is and then divide it by 12, assuming you keep track of this. I personally do, so it makes it easy for me to play with the numbers. For example, let us assume your monthly mileage is 1200 KM. You can decide to slash that by 7%, which means driving around 85km less a month. The number may not seem a lot, but annualized, the savings will be more significant, especially for those who drive a lot more than our example. This is savings not only in terms of fuel mileage, it is also savings on your overall car mileage and all the wear and tear that comes with that.

While the examples we gave above are mostly money related, you can take the same approach and set other goals related to your health or other areas of your life. To recap, you need to clearly define your goal and ensure it adheres to the SMART goal settings approach. Once you have that mapped out, then try sticking to your goals no matter what.