Set and Achieve A Money Goal the SMART Way


Determine your money goals and reach them with the SMART method. See how it’s done.

How to set a money goal

George T. Doran, a consultant and former Director of Corporate Planning for Washington Water Power Company, developed a goal-setting technique that goes by SMART, which stands for specific, measurable, achievable, relevant, and time-bound.

The SMART technique was initially developed as a strategy to help a company achieve its objectives. However, it is also an excellent guide to help you set any goal, including money goals.

Retire comfortably, save vs pay off debt, build an emergency fund, save for your child’s education. Any goal you may create can be a SMART goal.

Here is how to set achievable money goals the SMART way.


Setting money goals starts with a clear idea of what you’re hoping to achieve. And, instead of only focusing on the goal, be clear about the outcome you want.

If early retirement is one of your goals, be clear about the outcomes you want out of retirement. For example, is it to spend more time with the grandkids or traveling three months of the year?

Or maybe, you are thinking of early retirement because you really dislike your job. Early retirement may be the goal, the three scenarios with three different outcomes requiring three different approaches.

With that clarity, be specific. If a comfortable retirement is your financial goal – what would a comfortable retirement look like for you? A debt-free after-tax retirement income of $100,000?

Find clarity in what your goal means in real life.


The goal should not only be specific; it should also be measurable. As in the example above, a comfortable retirement may mean different things to different people. So how do you measure comfort? But a debt-free after-tax annual retirement income of $100,000 is both specific and measurable.

A goal such researching how to become a homeowner and calculating the down payment on a home is specific. To be measurable, you may first need to know the price range of the house you intend to purchase. Then, decide how much you want to put down towards the purchase - 10% or 20%? How much would that be in dollars? If you're planning on going on a trip, how much should you save for your vacation?

Define your unit of measure.


Once you know the dollar value of your goal, decide if it is achievable. Take a look at all your sources of income. How much can you realistically commit regularly towards that goal? This is when you need to get honest with yourself.

If you are currently living beyond your means, you will need to take a close look at how you can reduce your monthly expenses. Look at your bank or credit card statements for the past three to six months: are there any “leakages” that you can plug? Such as unnecessary bank or credit card fees? Look at what you can eliminate or reduce. For example, instead of eating out three times a week, decide to do it only once a week.

Decide on how much you can put away monthly or bi-weekly towards your goals. Automate your contributions. Use an app such as Monorail to funnel extra cash to your goals.

Whether it is a long-term money goal or a short-term goal such as a trip abroad, the Monorail app can help you make projections on how much and how often you need to save to achieve your money goals. In fact, it is created to help you manage your money with your goals in mind.

To achieve your goal, you must define realistic expectations and adjust accordingly. Ask yourself how much should you save a month to reach your goals.


Most of us have along list of financial goals. But they don’t all take the same priority. You may want to retire comfortably eventually, but if you are in your twenties and just married, saving for the down payment on a home may take priority over saving for a comfortable retirement. And if you have young children with a specific time frame for when they will need post-secondary education, then saving for that purpose becomes a high priority.

To make your goals achievable, narrow them down to three of your highest priority. With finite resources, you must focus on what is of greatest urgency. And most aligned with your values.

You may have children and believe that by eighteen, they should be able to fend for themselves.

Saving for their education may not be a priority for you. It may not even factor in your list of money goals. A key element in setting money goals is ensuring that they align with your values.


Knowing when you’d like to achieve your goal is also essential. In investment planning, this is called your time horizon. Your time horizon determines where and how you save or invest to achieve your money goals.

Money used to fund short-term goals requires different investments than that needed for long-term goals.

Asset allocation is a strategy of investing different portions of money into varying asset classes. Depending on your risk tolerance, long-term goals require growth investments that generally produce a higher rate of return over the long term.

For a goal you’d like to achieve within the next two to three years, you would want the money invested in something safe. Not in something volatile that could cause your principal to drop substantially in the short term. If your goal isn’t necessarily time-bound, you may even just set money aside, non-invested in the market, for goals like this – setting aside extra cash as you go for your personal goals.

Set Your Money Goals the SMART Way

Financial planning is about planning for the future – while also remembering to live in the moment. Setting money goals that are specific, measurable, attainable, relevant, and time-bound is a smart way to achieve them. And a bit of financial literacy can go a long way.

See how the Monorail app can help you achieve your saving goals the SMART way.

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