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How to Make SMART Financial Goals

Setting SMART financial goals provides a roadmap for achieving your desired financial outcomes.

Have you ever wondered why some goals seem easier to attain?

There’s a good chance those goals were SMART.

What are SMART Goals?

SMART goals use a framework to create specific, measurable, achievable, relevant, and time-bound objectives to guide goal-setting.

SpecificGoals should be clear, well-defined, and focused on a specific outcome or result.
MeasurableGoals should be quantifiable, allowing progress to be tracked and measured objectively.
AchievableGoals should be realistic and attainable, considering available resources, skills, and constraints.
RelevantGoals should be relevant and aligned with broader objectives, values, and priorities.
Time-boundGoals should have a defined timeframe or deadline for completion, creating a sense of urgency and focus.

Let’s consider an example to illustrate the importance of SMART goals in achieving success:

Crystal wants to improve her physical fitness and sets a goal to “exercise more.”

Non-SMART Goal:

  • Goal: Exercise more.
  • Issue: This goal lacks specificity and measurability. Crystal doesn’t specify how much exercise she intends to do, what exercises she’ll engage in, or how often she’ll work out. Without clear parameters, tracking progress or knowing when the goal has been achieved is challenging.


Let’s use the framework to make the dream attainable.

SpecificCrystal sets a specific goal to “run for 30 minutes three times a week and attend two strength training classes per week.”
MeasurableShe can track her progress by recording each workout session and monitoring her distance, duration, and intensity.
AchievableCrystal ensures her goal is realistic by considering her current fitness level, schedule, and available resources. She chooses a workout routine that fits her lifestyle and capabilities.
RelevantImproving her physical fitness aligns with Crystal’s overall health and wellness goals, supporting her desire to lead a more active and balanced lifestyle.
Time-boundCrystal sets a deadline to achieve her goal within three months, providing a sense of urgency and accountability.

Importance of SMART Goals

SMART goals offer a framework that promotes clarity and direction, enabling you to clearly delineate what needs to be accomplished. By setting specific, measurable objectives, you cultivate a sense of purpose and motivation, propelling you to consistently pursue your goals.

The structured nature of SMART goals fosters accountability, as clear expectations and deadlines facilitate progress tracking and self-imposed responsibility for outcomes. This approach also encourages focus as you prioritize efforts and allocate resources toward activities that directly contribute to your goals.

The following table can help you determine if your existing financial goals are SMART.

Financial GoalDescriptionSpecificMeasurableAchievableRelevantTime-bound
Emergency Fund SavingsSave $5,000 in an emergency fundYesYesYesYesYes
Debt RepaymentPay off $10,000 in credit card debtYesYesYesYesYes
Retirement SavingsContribute $500 monthly to retirement accountYesYesYesYesYes
Home Down PaymentSave $40,000 for a down payment on a houseYesYesYesYesYes

Creating SMART Financial Goals

Setting SMART financial goals provides a roadmap for achieving your desired financial outcomes.

Here’s how to establish your SMART financial goals:

Identify Specific Goals

Define specific financial goals that are meaningful and achievable within a defined timeframe.

Specific Goal: Save $10,000 for a down payment on a home within two years.

Make Goals Measurable

  • Quantify your financial goals with measurable criteria such as dollar amounts, percentages, or milestones.
  • Break down larger goals into smaller, manageable steps to track progress over time.

Measurable Goal: Save $500 per month towards the down payment goal.

Ensure Goals Are Achievable

  • Assess the feasibility of your financial goals based on your income, expenses, savings, and investment capabilities.
  • Adjust goals as needed to align with your current financial situation and constraints.

Relevance and Time-Bound

  • Ensure your financial goals are relevant to your long-term objectives and values.
  • Set specific deadlines or timeframes for achieving each goal to create a sense of urgency and accountability.

The following are other examples of SMART financial goals.

Specific GoalMeasurable CriteriaAchievabilityRelevance & Timeframe
Save $10,000 for Emergency FundSave $200 per monthAchievable based on income and expensesRelevant for financial security within 2 years
Pay off $5,000 Credit Card DebtIncrease monthly paymentsAchievable with budget adjustmentsRelevant to reduce high-interest debt within 1 year
Contribute $6,000 to Retirement AccountIncrease monthly contributionsAchievable within budget constraintsRelevant for long-term financial security by age 65

How to Reach Your SMART Financial Goals

Tip 1: Prioritize Goals

Rank your goals in order of importance and urgency. Allocate resources and focus on high-priority goals while maintaining progress toward long-term objectives.

Tip 2: Review and Revise Regularly

Periodically review your goals and adjust based on changing circumstances or priorities.

Tip 3: Celebrate Milestones

Celebrate achievements along the way to stay motivated and engaged in the financial planning process.

Tip 4: Seek Professional Advice

Consult with a financial advisor or planner for guidance on setting and achieving your financial goal.

Following these steps and tips, you can create SMART financial goals to help you on your financial wellness journey.

Jason Vitug

Jason Vitug is a bestselling author, entrepreneur, and founder of phroogal.com and thesmilelifestyle.com. His purpose to help others live their best lives through experiential and purposeful living. Jason is also a certified yoga teacher and breathwork specialist and has traveled to over 40 countries.

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