Too many people have great intentions, but fail to meet their goals. It’s not because they want to hurt their finances, it’s because they lack a system that will help them achieve their dreams.
I’m going to share how you can create a financial game plan for next year and how you can actually follow through on it. The best part is once you have your system set up it’s just a matter of using 15 minutes a month to check your progress. Interested? Let’s get started.
Define Your Big Goal
What’s your #1 goal for next year? Maybe it’s paying down or off some debt. Perhaps it’s building up your savings or paying for a vacation before taking it. Whatever it is, pick a goal that’s important to you.
For this exercise I’ll use one of our own goals for 2012- getting a family car. Our current vehicle is small and crowded for our family. Before the baby it was alright; four people could fit and we still had some trunk space. Now we have baby gear and we tend to carpool with friends to events. In addition, the car is 12 years old and repairs are starting to increase.
However we want to avoid having a car payment with the family car. We keep our living expenses based on one of our incomes while we pay down the student loan and mortgage with the other. We purchased a car last year for my husband so we have a system that has worked; we just had to tweak it to fit our new goal for the family vehicle.
Break Goal Down Into Bits
Now that you’ve defined your goal, it’s time to break it down into bits, the smaller the better. Continuing our example, we’re not going to throw our money at the first car that fits our needs. This will be a big purchase, so we want to get the best value out of it.
Here’s the list that I’ve made on what to do:
- Build up our care replacement fund.
- Whittle down what car we’re looking for.
- Spread the word about the car hunt.
- Shop around locally to find the best deal.
- Get a 2nd opinion (from a mechanic).
- Purchase the car.
Looks a bit long, but I wanted to break it into manageable pieces. Can I get this task get started or done in a day? If so, then it’s small enough. If not, I try to break it down further.
Set a Deadline for Your Goal Bits
Now that you have an idea of what you need to do, it’s time to out your checklist into your calender. My recommendation is look at a goal or two a month. Don’t feel like you have to do everything at once.
Here’s how I broke down the plan:
- Build up our car replacement fund. We did a great job in 2011 with automating our payments into a dedicated savings account. I’ll review and adjust a monthly contribution the first week in January to build it up further. Deadline: January 31, 2012
- Whittle down what car we’re looking for. The two of us need to sit down and figure out a handful of makes and models that fit our criteria for a family car. We need to have something that’s mechanically reliable, has a good safety record, and gets the same or better gas mileage than the car we have now. Deadline: February 15, 2012
- Spread the word about the car hunt. I think is the easiest – we’ll tell all of our friends to keep an eye out for us and give them a price range. Deadline: February 29, 2012
- Shop around locally to find the best deal. We’ll be visiting private sellers and dealerships to see what around. We’ll probably pick a day out of the week to set aside for actively looking around. Deadline: March 31, 2012.
- Get a 2nd opinion (from a mechanic). With spending a good amount of money for this car and to find something that will last a bit we’ll pay to have a mechanic give us a second opinion. This step will be for cars we’d like to purchase. Deadline: December 31, 2012
- Purchase the car. Sign the check drive the car! 😀 Deadline: December 31, 2012
It’s going to be a fun ride this year, but baring any huge emergency/event we should reach our goal.
Psychology of Money
What goals do you have for next year? How will you accomplish it? Curious to see what affects your money making (or losing) decisions? Check other posts in the Money & Psychology series:
- Choosing Friends to Build Your Net Worth
- Decisions, Decisions – Making a Big Purchase
- Is Saving Really About Motivation?
- Ways We Spend Money Without Evening Knowing It (and How to Fix It)
- Barriers That Prevent us From Saving Money
- Dealing with the Stress of Financial Issues
- Getting Your Finances Ready for a New Job
- Are You Hurting Your Own Finances?
Photo Credit: Ha-Wee