Whether you are on a budget, in debt, or both, you likely can’t help but try to strive towards a big purchase, whether it be a new car, a vacation, or anything you have your heart on. Many people are in this same situation, and they are able to save for these occasions. What you need is to plan ahead and take the time to save, but in what ways?
There is a technique that people often use in order to save for large purchases called the “SMART goal”. Setting goals is important so that you can have a realistic plan to achieve as well as a path to get there. So long as you write down this goal on paper or your computer, rather than keep a mental note of your goal, you are far more likely to compete this goal. While there is never a guarantee that you will always reach your budget in the time you allow yourself so the SMART goal is a surefire way to help you understand how to establish what you need to do between now and your desired end date.
Here are the basics of a SMART goal, courtesy of your local center for payday loans West Kelowna:
What is your specific goal? What do you want to spend on? Why do you need it? How much does it cost? And how much time are you looking to take in order to afford it? If you want to spend on a vacation to Costa Rica, for instance, you should know how much it costs, when you plan on going, and how much money per month you are looking to save before your ideal date. This gives you realistic parameters of what to save monthly.
Is the goal measurable? Are you able to save money with the time you need? Can you look every month at your budget to know whether or not you are on pace to meet your goal? All goals must be measurable so that you can see whether you are on track to meet your goal or require some help.
Attainable means being able to achieve this goal despite the expenses you currently need to make for bills, food, and other things. Is this a realistic goal? Is it possible to still live comfortably when planning for this big purchase? Sometimes, it’s a good idea to review your income and expenses from the previous year to tell if what you are spending won’t interfere with what you want to save.
Is the goal relevant to what you want to get done in the time you are allowing yourself? Is this a goal worth striving for? Is now the right time to reach this goal? You would like to be sure this goal is worth the time and money without feeling guilty later or having it cost you something major down the road.
Of course, you would likely want to spend on this large purchase now if you had the power, but due to fiscal restraints, saving money will require time in order to afford what you want. When do you plan to purchase this? How often can you save money towards your bank? Eliminating the wait-and-see approach allows you to realize your goal is full of progress and closer than you think.