SMART Goals

Clearly defined goals are what help us make sure that we are taking the proper measures to have the life that we want to have. “Clearly defined” is the operative phrase in that sentence. So how do you make goals that can be clearly defined? You do that my employing the SMART method of goal setting.

SMART is an acronym that stands for Specific, Measurable, Achievable, Relevant, and Time-constrained. Specific means the goal must clear enough that anyone reading it can understand what the goal is. Measurable means you must be able to track your progress. Achievable means that it has to be a realistic and attainable goal. Relevant means that the goal must make sense when put in context with your other objectives. And time-constrained means there must be a definitive date when you want the goal to be achieved.

To illustrate the SMART method, let’s assume you are trying to save money to buy a house. A non-SMART goal would be something vague like, “I would like to save money for a down payment on a house.” This lacks virtually all of the characteristics of a SMART goal. A SMART goal would look something more like, “I would like to have $100,000 saved for a down payment for a house within the next five years.” Can you see the difference between the two and how the second one can help you be more successful?

If you don’t have any financial goals yet, now would be a great time to start. If you do have goals, reword them if the don’t follow the SMART method. It’s a good idea to always have goals that are short-term (less than a year), medium-term (1-5 years), and long-term (more than five years). Trying to find financial success without a goal is like going on vacation by driving aimlessly and hoping to find somewhere you like. It’s better to pick the destination ahead of time and making sure you’re headed in the right direction along the way.