Financial Foundations: Part 8 – Goals

This is the eighth of ten posts describing the key pillars of building a strong financial foundation. Read the introduction here. Check back each Monday for the next post in the series

“We tend to overestimate what we can do in an average day but underestimate what can be done over the course of a year.” – Chris Guillebeau

By setting and reaching goals someone can transform their financial future into what they want it to be. If you want to get out of debt, save for retirement or build an escape parachute to quit your job, setting a goal is an important step to take. By following some key steps you will be more likely to reach your goals.

Current State

Before you can set any goals you need to find out where you are currently. Collect all of your financial information from all of your bank accounts, debts and retirement savings. Determine your net worth.  Look at what part of your financial picture needs the most attention (i.e. debt, savings or retirement).

Future State

After you determine your current financial state and net worth pick a goal to reach. By focusing on just one major goal at a time you can put maximum effort into reaching that goal. Throughout my financial journey I used this tactic to pay off my car loan and all of my student loans.

While I’d recommend one main goal at a time make sure you are still contributing to the others. For example, if you are aggressively paying down your debt you will still want to contribute to your savings and retirement accounts, even if it is just a little bit. You’ll want to cover all your bases.

Baby Steps

Your goals should be broken down into smaller goals to achieve along the way. If you don’t do this you may become discouraged at how long it is taking you to reach your goal. Instead, set different stages to reach and celebrate each smaller goal along the way.

For example, let’s say you wanted to be able to do 100 push-ups in a row by the end of the year. If you can already do 65, that may be an achievable goal. If you can only do five though, you’ll have your work cut out for you. Instead aim to reach 25 by April, 50 by June, 75 by September and then 100 by December.

The same goes for financial goals. If you have tens of thousands of dollars of debt, you should break it into small pieces and set sub goals to reach. For a more in-depth look at how to use baby steps read what I wrote about using baby steps to start my blog.


A standard goal setting format is to make your goals S.M.A.R.T. Using all of these principles will help make goals that can be reached.

  • Specific – Set up goals that are detailed and precisely what you want to happen. “Get out of debt” is good, but “Pay off all of my credit card debt and student loans completely” is better.
  • Measurable – Determine a metric you can use to measure whether have reached the goal. “Work Out More” is not a SMART goal. “Exercise four times a week for 30 minutes each” is.
  • Attainable – Make sure your goal is something you can accomplish. If you make your goal be too hard or even impossible you will fail at meeting it.
  • Relevant – If you have a lot of debt, your goal should be related to that, not saving $1,000 for a new laptop.
  • Timely – Set a deadline for your goal. Attach a date or time to a goal and it is more likely to be reached.


The last step to reach your goals is to be accountable to others. By having other people know what you are trying to accomplish they can help keep you on track. Just by knowing that your accountability partners are aware of what you are trying to do you may get the motivation and drive to reach your goals. Ask specific friends or families to keep you accountable. Post your plan and goals on a blog, Facebook or Twitter. By building accountability into your goal setting you will have the framework set to reach these goals.

Next week we’ll discuss how both automating & un-automating your finances are the next pillars to building a strong foundation.

Financial Foundations Series

MoneyCaleb Wojcik