How to Set SMART Short Term Financial Savings Goals (w/ Examples)

Whether you’re a new college graduate or you just want to get your financial house in order, setting SMART short term savings goals can help you get the most from your money and set you on a path toward smart financial planning.

At Addition Financial, we work with members every day to help them achieve their financial goals – whether that's paying down credit card debt, growing retirement savings, or even increasing net worth. In this post, we’ll share some SMART financial goals examples and give you some expert advice on how to make goals that will set you up for success.

What Are SMART Goals?

Let’s start by explaining what SMART goals are and how to differentiate them from goals that may not be achievable. SMART is an acronym used to describe goals that are:

  • Specific
  • Measurable
  • Attainable
  • Relevant
  • Time-bound

It’s impossible to achieve a goal that hasn’t been clearly defined. Let’s look at an example: “Buy a house.” This isn’t a SMART goal because it’s too vague and poorly defined. A related goal that would be SMART might be this:

Save $20,000 for a down payment on a home within three years.

This short term financial goal is specific because you know how much you want to save. It’s measurable because you can figure out how much you need to save each month to reach your goal. The attainable part is dependent upon your income and other factors. Assuming you want to buy a house, the goal is relevant because you've made it one of your financial priorities, and it’s time-bound because you have set a timeframe to achieve it.

Download Now: SMART Financial Goal Setting Worksheet

Now that you understand what SMART short-term financial savings goals are, let’s see what our experts had to say about financial goals examples and suggestions.

Example #1: Create an Emergency Savings Fund

Our first example of a short-term savings goal comes from Maria Alcantara, CIM, the Founder of Millennial Money Queens:

“The number one personal finance short-term savings goal certainly is an emergency fund. The rule of thumb is to be able to cover 3 to 6 months of living expenses. While that sounds great, it can be a daunting task for some. For that reason, I recommend starting with $1,000. Start by taking inventory of what you currently have lying around your house and don’t use. Many of us have valuable items we will likely never touch again and can quickly liquidate on online marketplaces; for example, I’ve personally sold cameras, designer clothing, cellphones and furniture.”

We love this idea for jump-starting your emergency fund. From there, you can continue to build your fund by saving money from each paycheck. We suggest getting to an amount that covers six months of expenses as quickly as possible, but even having three months of expenses is a worthwhile goal. To make it a SMART goal, set a deadline for yourself for each stage of your emergency fund.

Example #2: Save for a Big Purchase

Our next short-term financial savings goal comes from Steffa Mantilla, a Certified Financial Education Instructor (CFEI) at Money Tamer. She offers this advice:

“Short-term savings goals are going to be goals that you want to reach within the next year or so. This can include yearly expenses like birthdays and Christmas presents or saving up for a big trip somewhere special. If your car is older, saving up for its replacement may also be a shorter-term money goal.”

While some people choose to save toward more than one purchase at a time, we recommend saving for one goal and once you get there, you can set a new goal.

Example #3: Set Yourself a Challenge

A lot of us spend money without thinking about it. We make impulse purchases based on our needs in the moment and we don’t realize, sometimes, how much we could be saving if we curtailed that behavior.

Jacqueline Gilchrist is the Founder of Mom Money Map. She told us:

“If you're looking to broaden your mindset on what saving opportunities are possible, I highly recommend doing a no-spend challenge. This is when you don't spend money over a specific period of time like a weekend, a week or a month. It doesn't mean you spend absolutely $0. You can set rules and give yourself allowances. I love doing no-spend challenges because they force you to learn new skills and open your mind to being more resourceful to avoid spending money.”

You will need to spend money on groceries, but you could make a commitment to cook in bulk for a month and not order takeout. Jacqueline suggests this list of short-term savings challenges for people who like the idea of gamifying their savings.

Example #4: Set Up Automatic Transfers

Karen Condor of US Insurance Agents offered us another short-term goal that involves reviewing your expenses and spending and automating your savings:

“Review your income and your expenses. Determine any unnecessary expenses and decide what you can either curtail or cease spending in those situations. Then determine how much money you can save per month towards your short-term savings goals. Open a saving account, which is a perfect vehicle for short-term financial goals since you can access it quickly and without penalty. Automate your savings by setting up a recurring transfer from your checking account into this dedicated savings account. Automation will make savings simpler and more successful.”

Maria Alcantara gave advice along the same lines:

“Set it and forget it. As much as we are inclined to want to save and budget, it doesn’t always play out that way in real life. Make sure your paycheck is deposited to a bank account other than the checking account you use for day-to-day spending and create automatic transfers to savings and checking accounts to cover your living expenses and start building a savings account.”

What we like about the idea of automating savings is that it forces people to be intentional about their spending. You’re less likely to spend money casually if you need to use your financial institution’s app to transfer money into your checking account to do so.

We suggest creating a budget and setting aside a percentage of your income for savings. We also love the idea of setting up a dedicated savings account for short-term financial goals. Addition Financial’s Holiday & Summer Savings Account is designed to facilitate short-term savings.

Example #5: Achieve Financial Balance

While there’s some benefit to be achieved by doing a no-spend challenge, in the long term, you’ll need to balance savings with spending. We suggest focusing on balance as a short-term financial goal.

Maria Alcantara also sent us a tip along these lines. She said this:

“I like to balance between the things we need to handle like debt payments if there are any, and fun experiences like travel or a personal good or experience you desire. As important as it is to take care of expenses, it’s also key to develop a good relationship to money and be able to reward ourselves positively with purchases that bring us joy and will encourage us to continue building personal wealth.”

You can make the goal of financial balance SMART by creating a budget that allows you some discretionary spending. Begin with a one-month goal of creating and sticking to a budget. From there, you can adjust your budget as needed and perhaps set a slightly longer goal of three months.

Example #6: Cut Costs on Four Bills

Our final SMART short-term savings goal example is to review your monthly bills and do whatever you can to save money on four of them. Here are some examples of how that might work:

  1. You have unlimited data on your smartphone but you’re connected to Wi-Fi 90% of the time. You can review the available plans from your provider and see if you can save money by downsizing your data plan.
  2. You have a cable plan that includes 100 channels you never watch. You can call your cable provider and talk about alternative plan options. Some providers will even offer a discounted rate if you’re willing to sign a two or three-year contract – or you could get rid of cable and just use the streaming services that you’re probably already paying for.
  3. You have your car insurance and homeowner’s insurance with two different carriers. You can call each carrier to ask about discounts for bundling policies and move your coverage accordingly.
  4. Your power bill is high, so you can research other providers in the area. If none are available – which is often the case – you can call your existing carrier to see if they offer energy savings programs that you can take advantage of.

Simply making a few phone calls over the next few days could help you save money each month. Once you see how much you can save, you can create new SMART goals to pursue with the savings.

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Bonus: 3 Types of Savings Accounts

  • Traditional Savings Account – Earn interest on your money in a share savings account. Access it online anytime and move money between savings and checking for easy access.
  • Retirement Account – Choose from a traditional IRA, Roth IRA or term share certificate IRA.
  • Insured Money Market Account – This short-term investment savings account lets you withdraw funds at any time, plus your money is insured. It has the growth potential of an investment account, but the flexibility of a traditional savings account.

Setting a SMART financial goal isn’t difficult. Provided you stick with the SMART rules, analyze your unique financial situation and follow the advice from our experts, you’ll be saving and achieving your goals without any difficulty!

Are you in the market for a new online savings account that you can use for a personal financial goal? Click here to open an Addition Financial Holiday & Savings Account today!

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