Within the past week, I finished the last of a series of personal finance sessions with students at a couple of different summer programs here in town. With each group, we talked about goals, and how having strong goals in place can help us make smarter decisions with our money. The concept, I explained, is that giving clarity to your goals will help you manage your money when it comes to both saving and spending. Firstly, you need to understand what your goals may cost so that you can save accordingly, and to know how long you’ll have to save. Secondly, when spending money, it helps when you understand whether a potential purchase gets you closer to your goal or delays you from achieving it.

Easier Said Than Done

Following one of the sessions, one of the teachers made a comment that had an impact on me. That day, I’d asked each student to list out a short-term, intermediate, and long-term goal. As she and I debriefed after the session, she said “so many of these kids can’t even think about the future. They’re dealing with too much in their lives now to look ahead.” Not only was the comment insightful, but it was humbling and eye-opening. And it got me thinking about the rest of us, even if we are lucky enough to be free of everyday worries to contemplate our future. Even when we apply the “SMART” structure (Specific, Measurable, Achievable, Realistic, Time-bound) to our goals, are the long-term goals still too nebulous? A short-term goal might be something easy to accomplish, but is it significant? Or maybe it’s simply a stepping stone to future goals. So, that leaves us with intermediate goals. Perhaps the timeframe is perfect for challenging ourselves to strive for something beyond our comfort zone, something that is enough to keep us motivated day after day, and something that will give us tangible benefits. Goals change anyway, and they shouldn’t be written in stone, so why not allow ourselves the opportunity to re-evaluate a few years from now?

For the purposes of the students I worked with this summer (primarily rising 4th through 8th graders), I told them their short-term goal timeframe is 6 months to 1 year from now; intermediate is anything 1 to 5 years from now; and long-term is something that is 5 years or more away. I realize that you may define these time frames different based on your knowledge or experience, but I feel like these are reasonable.

Write Them Down!

If a goal would require money to achieve, I asked them to also estimate what they thought it would cost. And I didn’t just ask them to think of these goals; I had them write each of them down. Based on a study she conducted, Dr. Gail Matthews found that you are 42% more likely to achieve a goal when you write it down.

Even before I had the students go back and apply the “SMART” framework to their goals, I noticed that the intermediate goals were generally the ones that already had the most meat to them; they were more specific than either the short-term or long-term goals, and the students seemed to have an easier time thinking about how much money might be involved.

Even as I reflect on my own goals, the intermediate one seems to be the one I think about first, and the one that excites me the most because I can visualize it more clearly. The short-term goal is almost too easily dismissed as something that will be easy to achieve, allowing me to either delay it, or just assume that it will be knocked out quickly. The long-term goal, on the other hand, is harder to clearly define in my mind’s eye. I can’t quite picture it with the clarity I have when I think about the intermediate goal.

Your turn

When’s the last time you wrote down goals for yourself? Notice that I said “wrote down,” not “set.” These are two very different things. We set New Year’s resolutions, but we all know how those turn out.

Even if you want to adjust the time frames for your goals, that’s fine with me. The ones I use are easier for the students to grasp, but adults may have the ability to extend each goal out a little bit since they’ve had a bit more “real world” experience.

Either way, give it a shot. Your goals don’t have to cost anything either. But if they do, get a feel for what the cost might be (or do some serious research and get the amount exact), and identify how long it will take you to save the money to achieve it/them.

Your goals may change over time, and that’s fine too. Allow yourself the opportunity to course-correct as you learn more about yourself and find your passion in life. If you find that your current spending doesn’t align with your goals, it’s time to make some changes. The goals you write down reflect what’s important to you, so make sure you’re spending in a way that does the same.

Remember how I mentioned in my first post that I still want to get my pilot’s license? My intermediate goal is to achieve that within 5 years. So, there you have it – not only written down, but out there for the world to hold me accountable!