Whether you are a home owner or hoping to purchase your next home, saving money can be a very hard task for many! If you find yourself living paycheck to paycheck it can be even harder to imagine where the extra money to save is going to come from.
The first step I would encourage is to PICK A GOAL!! That’s right, grab a pen and paper and write down what your goal for savings actually is. It might be to pay off a credit card, save for a down payment, a home improvement project, a vacation, etc. Having a goal helps you stay focused! When you know what you are hoping to obtain it becomes easier to look at where you are spending your money and to evaluate what is a want vs. a need.
SMART goal setting is a great tool to help you set a goal
These 5 criteria with help focus your goal. Lets run through an example!
Pay off your credit card debt of 2500 in 18 months.
Specific– This goal is specific because it gives an actual amount ($2500) to be paid off of a credit card debt.
Measurable– This goal will be measurable because it is a set amount of money and a set time. A good idea would be to have check points along the way.
Attainable– This will depend on the person setting this goal and the interest rate of the credit card. If they do not have ~$145 a month to put towards their credit card bill each month they will not be able to attain this goal. They may have to cut out some spending and/or figure out ways to increase their income.
Realistic – Be honest with yourself and you ability to make this change. Is this amount in 18 month realistic? Should you extend the time and decrease the payments or is 18 months doable?!
Time-bound – this example definitely is set by a deadline! Setting a deadline helps keep your accountable!
Now that you have your goal, put it into action!
Stay turned for next weeks post with tips for examining your spending and finding places to save money.
Leave us a comment on what your money saving goals are and if you can apply SMART goal criteria to this goal!
