How to set financial goals that actually stick
It’s easy to think financial success is about willpower alone — and to feel discouraged as a result. But with a clear framework, setting goals can be more achievable and far more motivating.
Setting financial goals sounds simple. Save more, spend less, invest wisely. Yet for many people, good intentions fade within months, leaving goals half-finished and motivation low.
The good news: it isn’t you. Setting vague or unachievable goals can actually harm our sense of motivation, and after a few failed attempts, it can become more difficult to pick yourself up and try again.
And more good news: there’s a simple framework to help you set goals you can actually achieve.
Start by understanding the different types of financial goals
Most financial goals fall into three categories based on how far into the future you’re planning:
Short-term goals cover the next 0-2 years. They might include building an emergency fund or saving for a short trip. Short-term goals tend to be paid for quickly, which means the money you put towards them needs to be easily accessible.
Medium-term goals sit between 2-10 years. Examples include saving for a house deposit or funding your child’s education. These goals allow for a bit more flexibility in how you save or invest, but still need a balance between growth and stability.
Long-term goals look 10+ years into the future. Retirement planning is the most obvious example, but long-term goals can also include paying off your mortgage or preparing to support a family member later in life. Because of the longer timeframe, you have the advantage of time in the market, which means you can consider a broader range of investment options.
Dividing your goals into these three categories ensures your strategy matches your timeline. It also gives you smaller, more regular goals to achieve and feel motivated along the way.
Using the SMART framework
Once you know what you’re aiming for, the next step is to turn those ambitions into something tangible. The SMART framework helps you hit all the bases.
SMART goals are:
- Specific – Clearly define what you want to achieve
- Measurable – You should be able to track what you need and what you’ve saved so far
- Achievable – Goals should stretch you but still be realistic based on your income, expenses and circumstances
- Relevant – Your goals should reflect what truly matters to you
- Time-bound – Set a deadline. A timeframe creates momentum and helps shape your saving or investment approach
For example
| Ambition | SMART goal |
|---|---|
I want to save more money for emergencies | I want to build an emergency fund of £10,000 over the next 18 months by saving £550 each month into a savings account |
I’d like to buy a home one day | I want to save £30,000 for a house deposit in five years by setting aside £500 per month and reviewing my progress annually |
I want to be better prepared for retirement | I want to contribute at least 8% of my salary into my pension each year to stay on track for retiring at 65 |
Watch out for common pitfalls
Once your goals are clearly defined, a few simple habits can help keep them on track. Some of the common pitfalls include:
Unrealistic expectations. Overestimating how much you can save or how quickly investments will grow leads to frustration. It’s better to start conservatively, adjusting over time as needed.
Lack of tracking. Goals that aren’t monitored are quickly forgotten. Regularly reviewing your progress – monthly for short-term goals, quarterly for medium- and long-term ones – keeps your goals front of mind and lets you course-correct early.
Not revisiting goals. Life changes – careers shift, families grow, priorities evolve. Goals should be reviewed and updated so they continue to reflect your needs.
The power of accountability
Sharing your goals with someone you trust builds accountability. It may be helpful to speak to your partner or family, not least because your goals likely affect them. You'll be able to align your financial plans and mutually support each other along the way.
Working with a financial adviser is another way to build accountability while also getting access to personalised advice. An adviser can help translate your goals into a step-by-step plan and provide an expert perspective when market volatility occurs. Regular check-ins also create a natural rhythm of review and adjustment, helping you stay on track.
Making your goals stick
Financial goals have an element of willpower, but it’s much easier to stay motivated when you’ve set yourself up for success.
Most importantly, remember that financial planning is a journey, not a one-off exercise. Small, consistent steps turn good intentions into lasting outcomes.
Important information
This article is for information purposes only. It is not intended as financial advice.
Fees and charges apply.
The value of investments and the income from them can fall as well as rise and are not guaranteed. You might not get back your initial investment.
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