Journaling is a wonderful activity. It can help you record past experiences, learn more about yourself, strategize and set life goals, and generally plan for the future. When it comes to finances, though, well, they tend to be a bit of a drag. Everything from paying bills to balancing spreadsheets can be exhausting, overwhelming, and all-around discouraging.
Fortunately, if you use journaling as a financial tool, it can breathe life into your financial activities, particularly by helping you set and maintain financial goals.
The Importance of Setting Financial Goals
When the topic of finances comes up it typically evokes images of things like cashing paychecks, setting budgets, paying credit card bills, and making mortgage payments. One critical item that is often overlooked in this list is the concept of setting financial goals.
In the same way that paying bills and cashing paychecks are essential to short-term monetary health, setting goals can be the lynchpin to long-term financial success.
Financial goals provide a focal point for you to work toward. For instance, if you’re steeped in debt or living paycheck to paycheck, goals can serve as a lighthouse during a storm — something that you can stay focused on as you work through each surge. If you’re doing well, monetarily speaking, financial goals can still be a powerful tool that can take your finances from a walk to a run. They can productively propel you toward positive goals that can build a brighter future.
While specific financial goals will always vary, a few common items that they contain include:
- Paying off debts, such as credit cards or student or car loans.
- Creating short-term savings for an emergency.
- Putting money away for retirement
- Saving up a down payment for a home.
- Launching your own business.
- Going on a family vacation.
The variation in goals, from paying off debt to going on a vacation, demonstrates that it isn’t the specific goals themselves that are the key to success. It’s the very concept of setting and sticking to goals that makes them so powerful — and that’s where your journal can come in quite handy.
Using Journaling to Set Financial Goals
Lose weight. Stay on my new diet. Spend more time with the kids. Get a promotion at work. There are endless goals that you can highlight in your journal. Writing down and discussing your goals in an intimate setting like a diary can have a huge impact on fleshing out and understanding what each goal entails. It can turn pleasantly vague desires into bonafide strategies and action plans.
When it comes to journaling your financial goals, in particular, it’s important to go about setting your goals in a specific, attainable, and realistic manner. Keep the old SMART goals acronym in mind while choosing your goals. That is, set goals that are:
- Specific.
- Measurable.
- Attainable.
- Relevant.
- Time-based.
By aiming for SMART goals, you can ensure that your journaling doesn’t turn into pie-in-the-sky wishful thinking, but rather detailed and effective goals to work toward. Here are three steps to help you set and keep your financial goals through journaling.
Record Your Goals — In Detail
The first thing that you need to do is identify your financial goals — in detail. Remember, you’re looking for goals that are specific, timely, attainable, and relevant, so making an elaborate bullet-journal entry focused on “improving my finances” doesn’t count. Instead, look for ways to exercise genuine future self-journaling, by:
- Evaluating your current financial situation openly and honestly.
- Identifying your ideal financial state that you’d like to end up in.
- Finding activities and habits that can get you to your ideal end state.
- Coming up with real-world strategies to accomplish each one.
A few common goals to consider as you self-journal include:
- Creating a budget: Tracking your income and expenses is a critical first step in gaining control over your finances.
- Updating your budget: As things change over time, it’s important to maintain a schedule to regularly address updates and changes in your budget.
- Paying off debt: Car loans, school loans, maxed out credit cards, personal loans if you have significant amounts of debt, paying it off is a good idea.
- Creating an emergency fund: Having short-term savings is an excellent goal, and it can directly impact your ability to avoid adding to your debt.
- Raising your credit: Poor credit can hobble your financial future — if you have a bad credit score, set a goal to increase it through activities like making regular payments and paying down debt.
Each person’s goals will vary. Journaling your way to your own goals and how to go about attaining them is the first step in genuine long-term financial freedom.
Keep Yourself Accountable
Once you have your goals set, it’s time for the “measurable” part of the SMART goal idea to kick in. If you’ve truly set SMART goals, each one should have an easy way to measure how well it’s going. For instance, paying down debt by a certain future date is easy to measure. So is saving up a specific amount for an emergency fund or boosting your credit score to a certain level.
Don’t just let each goal go unattended overtime. Use these metrics to keep yourself accountable as you go along. If you find that you’re not reaching goals on time, reassess and consider if you need to adjust the goal or your own behavior to reach it in an attainable manner.
Always Keep Growing
Finally, remember that the goal of journaling your finances, and of money matters as a whole, should never be perfection. Instead, adopt a growth mindset that is always seekings ways to improve, learn, and grow.
With that in mind, return to your journal often and assess how you’re doing. Take the time to write out your feelings, crunch the numbers, and ask yourself the tough questions. Use journal prompts like how you feel your efforts are going or if you’re okay with asking for financial help to flesh out your current situation.
If you find this process is overwhelming, use it as a chance to get extra creative by bullet journaling your way to financial clarity.
Journaling Your Way to Financial Goals
Financial goals are a key element to personal financial success. If you find the concept to be overwhelming, it’s wise to utilize the power of journaling to set and achieve your financial goals. By addressing this critical aspect of life in a medium that you naturally thrive in, it can make the process both enjoyable and effective as you work toward a brighter financial future.
Author bio:
Frankie Wallace is a freelance writer from the Pacific Northwest. She writes about a variety of topics and spends her free time gardening.
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