10 Tips for Staying Motivated And on Track With Your Financial Goals

Setting financial goals is crucial if you want your dreams and aspirations to become a reality. It could be difficult to afford certain aspirations, such as a home, a comfortable retirement, a foreign vacation, or a child's higher education, without setting clear financial goals. However, at times, it could be challenging to stay motivated and on track with your long-term financial goals as it is easy to get distracted and start spending your money on current desires rather than saving for the future. This article explains 10 tips that you can employ to stay motivated and on track with your financial goal.

1. Know the Purpose of Your Financial Goals:

To remain motivated while saving money, it is essential to understand the purpose behind your savings. Whether it is for a down payment on a house, a car, an expensive gadget, your child's higher education, or a dream vacation, having a specific goal in mind can make it easier to forego short-term pleasures. However, saving for a house, for example, can take a considerable amount of time and lead to discouragement. If this happens, you need to revisit your reasons for saving. This could include wanting to move out of your parents'/in-laws' home, preparing to start a family, or relocating. Whatever the reason, write it down and ensure it resonates with you. Saving simply for the sake of it is often insufficient motivation.

2. Set S.M.A.R.T. Financial Goals:

While defining your financial goals, you need to ensure that your goals are S.M.A.R.T., i.e., Specific, Measurable, Achievable, Realistic, and Time-bound. An effective financial plan is driven by your financial goals, and if you approach your planning by focusing on what you want to achieve, such as buying a house or retiring early, it can help you save more efficiently.

Your S.M.A.R.T. goals need not be common, like buying a house and a child's higher education; they can be unique, like opening a beach-side restaurant post-retirement. So, in this case, apart from the common goal of creating a retirement corpus, you also need to make sure you invest an adequate amount for your unique financial goal of opening a restaurant after retirement. The more relevant your goals are, the more you will be motivated to work towards achieving them. But any vagueness around the goals can become an obstacle to achieving them.

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3. Break Your Long-term Goals into Small Saving Goals:

After setting your financial goals, breaking them down into mini-saving goals is important. Most financial goals are long-term and can seem overwhelming when looking at the desired end result alone. Breaking them down into smaller steps can help you visualise and better understand each necessary action towards achieving them. For instance, if you need to build a corpus of Rs 5 Cr for your retirement, you can break it down into something like you will contribute 10% of your monthly salary towards your retirement fund, apart from the mandatory Provident Fund contributions.

4. Keep a Financial Journal And Track Your Progress:

Starting a daily/weekly financial journal is a great way to stay focused and on track with your financial goals. You can keep a handwritten journal or create an online journal that can be reused every year. By maintaining a daily/weekly financial journal, you can keep your financial goals at the forefront of your mind and have a regular reminder of where you want to be financially in the future. Furthermore, you can track your progress over time and review it when you feel frustrated or discouraged.

5. Surround Yourself with Like-minded People:

If your friends and family consistently put you in situations that negatively impact your budget, it can have a detrimental effect on your finances. It is advisable to surround yourself with people who support and encourage you on your financial journey whenever possible. These individuals can hold you accountable and encourage you rather than hindering your progress. It is also possible to create a mutually supportive environment where everyone can encourage and assist each other in achieving their financial goals.

6. Make Your Goals Visible:

Make sure to keep your financial goals in a visible place within your house so that you can see them multiple times throughout the day. Often people write down their goals and put them away, quickly forgetting about them. To avoid this, placing your goals in a conspicuous location can help you remember them. Consider placing them on your fridge, above your computer, or on the back of your door. The more frequently you see your goals, the more likely you are to stay motivated and committed to achieving them.

7. Celebrate Your Big And Small Achievements:

When you achieve your mini financial goals, it is essential to celebrate your successes. It's a crucial part of your financial journey to reward yourself with small treats when you meet your milestones. For example, after achieving a mini goal of quarterly saving, you can treat yourself to dessert at your favourite ice cream shop or purchase a hobby item you will use in your leisure time. However, make sure that these mini-celebrations are not too expensive and won't derail your progress.

8. Involve Your Family in Your Financial Plan:

While it may be tempting to keep your financial goals to yourself, it is actually more beneficial to share them with others. By doing so, you create personal accountability, and it becomes more difficult to give up or back out of your goals. Sharing your goals with your partner or family also creates a support system that can motivate and encourage you during difficult times. It is much easier to achieve your goals as a team rather than trying to do everything alone. More people means more ideas on how to reach those goals.

Besides, involving your family in your financial journey can be a learning experience for everyone, rather than just one person. If you fail to include your family, they may unknowingly undermine your efforts or not understand why certain financial sacrifices are being made. Therefore, including everyone and seeking their help, advice, and ideas can significantly increase your chances of success.

9. Be Prepared for the Unforeseen Challenges:

It is important to acknowledge that unforeseen challenges can arise, regardless of how competent or prepared you may be. By recognising this possibility, you can ensure that you have established support systems that will assist you in overcoming any difficulties and remaining focused on achieving your objectives.

Being part of a financial community and maintaining a financial journal can be especially beneficial during times of unexpected setbacks. Recognising that these setbacks are bound to happen can help you stay resilient and focused on your goals. With the support of your financial community and the remainder of your past progress through your diary, you can better resist the temptation to give up.

10. Review Your Financial Goals:

If you are not excited towards your financial goals as you initially were, it could be a sign that you need to review them. A change in your life circumstances can cause you to lose interest or outgrow a specific goal. If you are not motivated to achieve a specific goal, you should consider creating a new goal or re-prioritising existing goals. You may find that you need to shift your focus to a different objective, and that's okay. You can always redirect the money you have saved towards another goal.

KETKI JADHAV is a Content Writer at PersonalFN since August 2021. She is an MBA (Finance) and has over seven years of experience in Retail Banking. Ketki specialises in covering articles around banking, insurance, personal finance, and mutual funds and has been doing it for over three years now.