Achieving your financial goals is all about getting one step closer to the life you daydream about, where you feel happy, secure, and on top of the world.

In this post, I’ll walk you through how to set and achieve your unique financial goals. You’ll learn clever ways to achieve them that feel fun and motivating, not restrictive or boring. 

7 steps to achieve your financial goals faster

1. Write down your financial goals. 
2. Create SMART goals. 
3. Track your cash flow. 
4. Allow flexibility in your spending. 
5. Increase your disposable income. 
6. Reward yourself at significant milestones. 
7. Find an accountability partner.

Here’s what you need to know to use these 7 steps to set and  achieve your financial goals faster.

Why you need financial goals

While everyone is different, we all have things we want, such as a new car, a remodeled home, no more student loan debt, and a secure retirement. But the truth is, very few people make a plan to achieve what they want. Instead, we wander around aimlessly, hoping one day they’ll magically happen. 

You only have a finite amount of money to work with each month. Using it to reach your goals is critical for building a life you love and enjoy.

But dream with me for a moment. What if you decided right now to get serious about using your money to build the dream life you desperately crave? What if you committed to setting financial goals and creating a crystal clear plan for achieving them? 

You only have a finite amount of money to work with each month. Using it to reach your goals is critical for building a life you love and enjoy. Here are the seven steps to do it. 

• 1. Write down your financial goals

Who do you think is more likely to achieve their goals, someone who has just a vague idea of their goals or someone who has put them clearly down in writing? You got it: The person who writes them down. A study found you’re 42% more likely to achieve your goals if you write them down. Pretty cool, right?

Take 30 minutes today to write down your financial goals. Aim high and hold nothing back! Maybe you want to save for a vacation, start a joint venture, or buy an investment property. Perhaps you want to increase your income, invest for your kids’ college education, or increase your cryptocurrency holdings. Whatever it is, write it down no matter how out of reach it may sound right now.

2. Create SMART goals

SMART is a classic goal-setting technique that helps increase your chances of success. It stands for specific, measurable, achievable, realistic, and time-based. 

If you write, “I want to save more for retirement,” that doesn’t create a roadmap for how to do it. But if you use the SMART formula, it prompts you to go deeper. Here’s an example:

Specific: “I want to max out my 401(k) this year. The maximum amount I can save is $19,500.”

Measurable: “I will adjust my income tax withholding at work on Monday, so I put $812.50 of my bi-weekly paycheck in my 401(k). That will allow me to save $19,500 this year.”

Achievable: “I will achieve this financial goal by reducing my monthly expenses and saving any bonuses or overtime pay I receive.”

Realistic: “I will reduce my monthly expenses by eating out only once a week and reducing the data limit on my cell phone plan.”

Time-based: “I will accomplish my goal of maxing out my retirement account by the end of the year.”

You can use this SMART goal formula to create short-term and long-term goals. For instance, you might want to save a certain amount within a few months to take a vacation, or you may have a dream to save $4 million for retirement over several decades. 

3. Track your cash flow

How much money do you make each month? How much do you spend? Knowing the answers to those questions is what it means to track your cash flow.  

The easiest way to monitor your income and expenses is to use a budgeting app. Now before I lose you, I don’t believe that budgets should be super restrictive. In fact, I prefer to use the term spending plan because you should have a plan for where your money will go each month.

In 8 Best Budgeting and Personal Finance Tools, I cover some of my favorite budgeting and money tools. Check it out and choose one or more tools to try out.

4. Allow flexibility in your spending

When you get started with your financial goals, you’ll probably feel fired up and motivated. You’ll be willing to cut loads of expenses and do whatever it takes to get there as quickly as possible. 

The secret to staying motivated is to leave wiggle room in your spending plan for things you enjoy.

But if your financial goals are significant, the shine of making sacrifices to achieve them may start to wear off a few months into your journey. You’ll begin to lose steam and wonder why you’re depriving yourself of everything now when the finish line seems so far away. 

The secret to staying motivated is to leave wiggle room in your spending plan for things you enjoy, and I’ll talk more about that in a moment.

5. Increase your disposable income

Disposable income is what you have leftover to spend after taxes. The more disposable income you have, the faster you can achieve your financial goals. So, brainstorm ways to boost it by increasing your gross income or decreasing your expenses, or both.

Consider negotiating a raise with your boss, starting a side hustle, or decluttering your home and selling the excess on Poshmark or eBay to increase your income. To decrease your expenses, try cutting out subscription services, cooking at home more, or creating a debt-reduction plan to slash your interest expenses.

6. Reward yourself at significant milestones

Most financial goals are pretty significant. In addition to being flexible and leaving wiggle room in your cash flow for things you enjoy, you may also want to create a system where you reward yourself when you hit significant milestones. 

For example, let’s say your goal is to build a $10,000 emergency fund. You break it down into four smaller milestones to save $2,500, $5,000, $7,500, and then $10,000. You might give yourself something special after hitting each one, such as getting a massage, buying a new book, or going out for a great meal. 

7. Find an accountability partner

Beyond writing down your financial goals, monitoring your cash flow, and putting in the work, the most important thing you can do to reach your dreams is sharing them with others. Telling people you trust about what you genuinely want to achieve with your money reinforces your goals and creates accountability. It also gets other people interested in seeing you reach your dreams.

So, think for a moment. Who’s the right person to keep you fired up and motivated to achieve your financial goals? Who will give you a little nudge when you get off track? It could be a family member, a friend, or even an online community of like-minded people. 

10 Financial Goals You Should Set 

If you’re not sure what your financial goals should be or in what order you should achieve them, here are ten ideas.

1. Build a cash reserve so you can handle unexpected financial emergencies. Make it a priority to achieve this goal first so you won’t be caught off-guard by something unexpected, such as losing your job, having an expensive medical bill, or needing a car repair.

2. Max out your employer’s 401(k) match to get the benefit of free money. Getting the max varies depending on what’s offered in your workplace but may translate into saving 2% or 3% of your income.

3. Increase contributions to your retirement account and build security for the future. If you don’t have a 401(k) at work or you’re self-employed, you can open your own account, called an individual retirement account or IRA. No matter which type you use, slowly boost your retirement contributions until you max out the account.

4. Max out your health savings account (HSA) to cut the cost of healthcare. If you have an HSA-eligible health plan, this account allows you to pay for a variety of medical expenses on a tax-free basis.

5. Increase your income so you have more disposable income to save and invest. Check out 5 Tips to Build a Side Business for ideas and inspiration to create an additional income source.

6. Pay off your high-interest debt to reduce your interest expense as much as possible. If you need a step-by-step guide to create a debt reduction plan, don’t miss Laura’s best-selling online class, Get Out of Debt Fast: A Proven Plan to Stay Debt-Free Forever.

7. Purchase insurance to fill any coverage gaps you may have, such as a health plan, term life insurance, or long-term disability policy.

8. Save for your next vacation so you can pay for it in cash instead of credit.

9. Save for a home down payment to reduce your monthly mortgage payment and interest.

10. Contribute to a 529 savings plan to reduce taxes on college expenses for you or a child.

If you choose one or two short- or long-term goals and tackle them this year, your financial life will leapfrog, and your happy future self will thank you.