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3 Ways to Set Financial Goals You'll Actually Keep

Are your financial goals similar to New Year's resolutions? Great ideas in theory, but ones you don't take action on?

Maybe you set a goal to save 20 percent of every paycheck, become debt-free or pay cash for your next car.

Maybe your goal was to aggressively pay down your mortgage so you can be mortgage-free within the next 10 years. Maybe you want to max out your child's college fund or your retirement accounts.

When you first set these goals, they sounded fantastic, right? Only now, you realize several months have passed, and you're no closer to achieving them than you were before.

What can you do? How can you set financial goals you'll actually keep? Here are a few recommendations.

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1. Set tiny goals.

I know this flies in the face of conventional advice that tells you to dream big, but here's the paradox: The best way to achieve a big goal is in tiny bite-sized chunks.

Perhaps your long-term goal is to save enough money to purchase a rental property or max out your 401(k). That's a huge, five-digit goal and that giant number can feel intimidating. As a result, you make no progress. You can feel totally frozen, unable to move forward, just because the goal is so massive. Let's modify this.

Break your goal down into smaller actionable steps. First, save $100 per week. Every week, as you save $100, you feel the psychological thrill of victory. You did it again this week, you achieved your goal. You can pat yourself on the back and do a little happy dance. You can even pick your favorite way of celebrating, as long as it's frugal -- maybe for you that means scheduling a get-together with a friend or catching up on your favorite show.

After weeks of saving $100, you'll be shocked when you realize you've accumulated a hefty four figures. You're well on your way to achieving that big long-term goal now. You didn't do it by focusing on the big dream, but instead by focusing on the next bite-sized step.

2. Share your progress publicly.

Announce your goals on Facebook, Instagram, Twitter or another social media platform you use the most. If you want, you can even start a blog to document your progress towards your goal. I'm not suggesting that you share any sensitive or personal information, of course, especially regarding your finances -- you'll want to be sure to keep any bank account details or credit score numbers to yourself -- but there's nothing wrong with being vocal about the progress that you're making and the goals that you have.

Share every step publicly, both the good and the bad. If there's a week where you achieved or surpassed your bite-sized goal, tell your followers. If you had a week where you completely fell on your face and made no progress (or made negative progress), tell your followers that story as well. Public accountability is a great tool for keeping you on your game. It also doesn't seem so much like bragging if you share both the frustrations and the victories.

3. Use a calendar.

I have an old-school paper calendar. The kind that sits on my desk. Every day I make significant progress towards a goal, I circle that day on my calendar.

For example, if I earn more than a certain amount of money in a given day as measured by the projects that I take on, I'll circle that day on the calendar.

You can do the same. For example, circle days when you spend less than a certain amount, when you negotiate a bill or when you lower an insurance premium.

The benefit of having this paper and ink calendar in front of me is that it's always there. It stares me in the face and reminds me that progress is a series of small steps practiced daily.

It's not some digital browser window I can minimize or an app I can overlook. It's a piece of paper I see out of the corner of my eye because it's on my desk at all times. That's a powerful tool.

I hope these tips help you reach your financial goals, whatever they might be.

Paula Pant is the founder of Afford Anything, a website that helps you build wealth and maximize life. Afford Anything is an online movement against tired old financial advice that says you should skip lattes and chain yourself to a desk for 40 years. Paula Pant launched the site after she quit her 9-to-5 job, traveled to 32 countries and became a successful entrepreneur and real estate investor.



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