Top 4 Mistakes to Avoid When Creating Financial Goals

New beginnings should start with new goals! Or updating goals to reach new heights. Now is as great of a time as any to start such a process with new financial goals and improving financial health. You want to make sure that you’re making good choices when it comes to money. 

Although the road ahead may appear long, there are some mistakes to avoid when creating financial goals, you’ll be able to reach the financial status you desire.

Here are four mistakes to avoid when creating financial goals. 

Don’t Use Generic Goals

One of the best ways to reach your financial goals is if you use the SMART-goal framework.

SMART stands for Specific, Measurable, Achievable, Realistic, and Time-bound. 

By using SMART goals, you will be able to specifically identify what you’re aiming for and a basic idea of how to approach it. 

This is how SMART breaks down.


You must decide on what you want your goal to be and have a specific outline for it. 

For this part, you should be able to answer the who, what, where, when, and why for your goals. 


Determine how you are going to measure the goals you have in mind.

If your goal is to save $400 every month then set out some weekly markers to make it easier to stay on track. 

For example, in the first week, be sure to save $100 then the second week save another $100, and so on. 


Make sure that whatever goal you set, you’ll be able to achieve it but don’t make it too easy. 

Focus on how you’re going to make this financial goal possible and achievable. 


You must sit down with yourself and make sure the end goal is realistic. 

You may want to pay off your entire mortgage in one month but if you make the average salary in your city then this goal may not be realistic. 


Always give yourself a time frame on how long you’re going to take to complete this goal.

If you don’t give yourself a time frame, then most of the time you’ll put it to the side when you have other stuff to do.

However, when creating a time frame make sure it’s reasonable and achievable for you. 

Don’t Overdo the Number Goals

It’s great to have goals in mind, such as paying multiple debts and savings goals, but if you try pursuing all of them at once you may get overwhelmed. 

People stop what pursuing goals in the middle, or even in the beginning, is due to the feeling of being overwhelmed. If you become overwhelmed, you tend to lose passion for the things you’re doing.

To avoid this feeling, what you can do is set two or three goals.

Focus on Small Goals

When you have these two or three goals in mind, break each one down into specific steps and even smaller goals.  

This will make it easier to complete one goal after the other if you work on short-term goals. Plus, once you complete them you should feel great about yourself. 

Build on this feeling to continue pushing forward.

Don’t Neglect Tracking Expenses

If you’re wondering why you don’t have enough money, then there’s a problem. 

You should be able to track all of your money and at the minimum know where your money is going.

How Do You Track Your Spending?

Record your expenses in a notebook, a spreadsheet, or an app. Your online financial accounts, like your bank accounts, credit union accounts, and credit card accounts, should also help you categorize your expenses.

Don’t forget small expenses such as snacks purchased at convenience stores with cash or automatic recurring expenses like exercise memberships and entertainment subscriptions.

Don’t Pay Too Much Debt Off

You might be thinking to put all of your income towards your goal, but you should avoid extreme measures like this.

If you’re able, don’t neglect putting money towards an emergency fund if you don’t already have one  nor investing in your future with stocks, mutual funds, or personal development. It’s always smart to invest in your future every chance you get.