Goals – What are they good for?
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It has become accepted wisdom not only in military culture, but in the wider Australian culture, that setting personal goals is a good thing to do. All sorts of academic studies on the topic seem to indicate that having authentic well-crafted clear goals increases your performance, persistence, motivation and all round wellbeing. Everyone from managers, to health care professionals, therapists, educators, coaches and social media influencers seem to somewhat cacophonously sing the same cheesy feel good song ‘It’s hip to have goals’.
An article suggesting that you set a few financial goals therefore stands the chance of being an eye glazing exercise. There is no way around it though. Based on our experience of teaching ADF members and their families about money over the past nearly two decades, there is likely nothing that will have more of a positive impact on your finances than setting some goals. We have been inspired by the many stories of members starting off by achieving modest goals and building on the success to ultimately achieve financial security. They can’t just be any goals though, you have heard it all before, the S.M.A.R.T acronym, in order to be effective, they should be:
- Specific
- Measurable
- Achievable
- Realistic
- Time-bound.
The good news is that financial goals are arguably uniquely able to be S.M.A.R.T.
For a simple example, your goal could be to save for a nice holiday at the end of the year:
- Specific – two weeks in Thailand from mid-December
- Measurable – you estimate that this will cost you $5,400
- Achievable – I have 18 pays to save up – $300 per pay
- Realistic – I can comfortably afford $300 per pay based on my budget
- Time-bound – I think we have covered that, by December.
So, here’s our challenge to you. Set at least a couple of simple financial goals. They don’t have to be complicated or long term to be effective. The golden rule is that you genuinely want to achieve them and it will help if you use the S.M.A.R.T formula. We have more practical information on how to go about it on our website.
TIPS:
Use the Moneysmart Savings Goal Calculator to work out how much you need to put aside each pay to achieve your S.M.A.R.T goals.
Use our online Budget Calculator to understand and manage your spending in order to make sure you have enough money left over to achieve your goals.
