Turn Your Big Money Ambitions into Manageable Micro Goals

Last year I decided to make a change when it came to setting resolutions. I sat down and wrote out a long list of huge goals I wanted to achieve in five different categories: self-improvement, wealth, health, professional, and relationship.

All in, I ended up writing down 29 goals for 2018. You may be thinking – wow, that sounds exactly like a normal person’s resolution list but an over-achiever’s version. And you’re not wrong!

I can tell you that looking at those lofty ambitions felt incredibly overwhelming, which is why I decided to also make micro goals this year. Micro goals are small, actionable steps that I can take each day in a new month in service of achieving one of the larger goals. I also hoped some of these micro goals would turn into a habit.

Micro goals are magic

When it comes to focusing on financial goals, micro goals are particularly helpful. Setting a big hairy audacious goal (or BHAG) makes it really easy to quickly become demoralized or keep putting it off because you’re not seeing much progression. Enter the micro goal. It helps turn your BHAG goal into a manageable and actionable goal.

Let’s look an example. You want to pay down $10,000 of student loan debt this year. Just setting that resolution without a game plan will make it much harder to achieve. But if you then decide that each month you will put $833.33 towards your debt, it becomes more actionable. Your short-term goal – or micro goal – is to put $833.33 per month towards the debt. Better yet, $208.33 a week. Now we’re getting VERY actionable. That also means you can easily rework your budget to ensure you’re hitting your goal each week, or you can focus on building a secondary stream of income to help you in your pursuit of your debt pay off plan.

But that’s not where it ends. You can break it down even further and relish in the celebration of the micro goal steps you’re taking to achieve your larger goal. Further niching down to the micro goals could look like this:

  1. Rework your budget to accommodate your goal
  2. Put automated systems in place, such as an auto transfer to your debt each time you get paid so you aren’t tempted to spend the money elsewhere
  3. Research options for a side hustle
  4. Apply for extra jobs to begin earning more money

Micro your micro goals

Each time you achieve one of these micro goals, it gives you a sense of accomplishment and helps lead you toward a place where achieving your BHAG is do-able. With this method, you’re always making forward progress, and that’s satisfying.

Striving to save more money is another example where you can take a lot of small steps to set yourself up for accomplishing your goal. No matter how much you’re trying to save this year, these micro goals can help get you there and stay focused on the BHAG you’ve set.

  • Research the banks with the highest interest rates on savings accounts so the interest does a little of the work for you. Granted, savings rates aren’t huge – but there is a big difference between 2.00 percent and 0.01 percent APY.
  • Switch to a higher interest rate savings account.
  • Set up a savings account just for savings. You may even want it to be at a completely different bank than your regular checking to help reduce the desire to keep raiding the account.
  • Nickname your savings account to reflect your goal. That helps throw up a little psychological barrier each time you’re tempted to skim a little off the top. It reminds you why you’re saving.
  • Automate your savings. Temptation gets the best of all of us. That’s why it’s best to reduce your likelihood to be tempted by having your savings money immediately routed to your specific savings account before it hits your checking account. You can generally go directly to your employer’s HR or payroll departments to set up automatic transfers.

Reset your intentions with micro goals

These small steps help you focus on your progress instead of risking feeling overwhelmed by the work that lies ahead. And when you do slip up (because we all do), quickly refer to your micro goals to reset your intentions and get that boost of success early on.

 

 

About Erin Lowry

Erin is a millennial personal finance expert and the founder of BrokeMillennial.com. She's also the author of Broke Millennial: Stop Scraping By and Get Your Financial Life Together. Lowry and her work have been featured on CBS Sunday morning, CNBC, Fox & Friends, USA Today, The Wall Street Journal, Cosmopolitan and NBC News. Connect with Erin on Twitter, Facebook and Google+.

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