3 SMART Financial Resolutions and How to Achieve Them in 2023

young mom making smart financial goals with baby child

The start of the new year is always a reminder to be more intentional with our lives and goals.

You may have friends who want to backpack through Europe this year, a colleague who wants to secure a big promotion, or a family member who wants to lose 20 pounds. No matter what your New Year’s goals are, a prosperous year is something we all hope to achieve. January is a time to develop new money habits and set goals for the year ahead, which is why we’ve put together 3 SMART financial resolutions and how you can achieve them in 2023.

What are financial goals, and why do I need them?

Financial goals are objectives you aim to achieve; examples of these goals might be saving for a wedding, buying a house, or paying off your student loan debt. These goals can play a big role in determining how you spend and save money, both short-term and further down the road.

Although some targets might be harder to reach than others, it’s likely going to be easier to achieve your goals if you identify them early on. For example, if you want to purchase a home, you will likely have to put a down payment on the home. If you wait until you are ready to purchase before you start saving for a down payment, you might find yourself in a bit of a tricky situation. Proper planning is essential to financial success.

How do I set SMART financial goals?

When goal setting for the upcoming year, consider using the SMART acronym. By creating goals using SMART, you are giving yourself attainable expectations to be completed in a timely manner.
  • Specific – Ask yourself what exactly you want to do; the more specific, the better. Spend some time defining a purposeful goal that will put you in a better financial position. For example, you might want to contribute 8% of your income to your 401(k) this year or save $1,000 for your emergency fund within six months.
  • Measurable – If you don’t set measurable goals, how do you know when you’ve been successful in reaching your target? Numbers are a great way to measure your progress along the way and can help you stay motivated.
  • Achievable – Set realistic goals for yourself that you honestly see yourself reaching. It’s easy to get carried away by setting your expectations too high. The idea behind creating financial resolutions is to improve your current financial circumstance, no matter how small you start. Remember, you are still taking steps in the right direction.
  • Relevant – Create a goal that will have a positive impact on your life. By choosing a goal that’s meaningful to you, you might actually enjoy the journey of trying to reach it. Get creative and spend some time thinking about what goals are most important to you.
  • Time-Bound – Setting a deadline for achieving this goal will encourage you to follow through. Keep yourself in check by not procrastinating and tracking your progress.

3 SMART Financial Resolutions and How You Can Reach Them

With the SMART acronym in mind, we’ve compiled 3 financial resolutions you might aim to achieve this year, and how you can reach them.


1. Budget to Create an Emergency Fund

Unexpected expenses could be a disaster for your finances if you haven’t planned accordingly. Ideally, an emergency fund covers at least three months of expenses. Don’t panic though, you can start out with a small savings goal each paycheck and increase it as you become more comfortable.

To calculate how much you should be saving for a rainy day, add up how much you spend on necessities each month, then multiply that number by 3. For example, if you spend $1,000 a month, then you should aim to have at least $3,000 in your emergency fund to cover yourself if a financial disaster were to strike.

Budgeting your money each month can help you see where you are over-spending currently. You might be spending excess money on subscriptions you don’t use or need, ordering out for lunch every day, or making too many coffee runs each week.

You might be wondering how you can implement the SMART formula with this goal, so let’s break it down together:
  • Specific – Save $3,000 in your emergency fund by the end of the year.
  • Measurable – Multiply your monthly spending by 3 to determine how much your emergency fund should be worth.
  • Achievable – Ask yourself if this a reasonable goal given your current financial situation. If you find this goal to be within reach, use a budgeting tool. There are lots of free resources available on the internet. Suppose after your research, you discover you can cut costs elsewhere and put $250 a month towards your emergency fund. If you realize you can only put $50 a month towards your emergency fund, that’s great too! Just readjust the time frame of your goal. Small steps in the right direction are still an accomplishment.
  • Relevant – Is this financial goal going to better the financial situation you’re in right now? If you have debt obligations with high interest rates, you might shift your focus to budgeting to pay off your debt rather than creating an emergency fund.
  • Time-Bound – By budgeting consistently and saving $250 a month, you will be able to reach your goal by the end of 2022.

2. Prioritize Planning for Retirement

Retirement: we all want to be able to do it someday. What are you doing today that’s going to help you get there? Maybe you contribute to your 401(k) but are you maxing out your employer’s contribution in addition to your own? Americans commonly underestimate the amount they need to retire. Financial experts estimate that most of us will need about 60% to 100% of our annual preretirement income to live on each year after we retire. Use this calculator to see how long your retirement savings will last.

The sooner you start taking retirement planning seriously, the more time you will have on your side. Here’s how you can use the SMART formula to help with your retirement planning:
  • Specific – Contribute a certain amount of money each paycheck to your retirement savings plan.
  • Measurable – To make this measurable, enroll in automatic contributions to your 401(k) through your employer and contribute a certain percentage each paycheck. Try to to contribute enough to max out your employer’s contribution match.
  • Attainable – By enrolling in automatic contributions to your 401(k) through your employer, you never “see” this money, so it might make this goal a little easier to achieve.
  • Relevant – We all want to retire eventually; however, you don’t want to put a strain on yourself trying to get there. If you decide to make 10% contributions to your 401(k), ask yourself if you can live comfortably on a paycheck roughly 10% smaller . If you don’t think that’s feasible, set a lower contribution limit. Remember, baby steps in the right direction are still steps in the direction of success.
  • Time-Bound – Retirement might feel like it’s far too close or forever away, depending on your age. How many years do you expect to work before you retire? Consider how much you would like to have saved in your account after a year, five years, etc..

3. Make a Plan to Pay Off Your Credit Card Debt

If you’ve accumulated debt on credit cards, try and pay it off as soon as possible. Not only is credit card debt typically high-interest, but if not managed correctly it can quickly become burdensome and hard to control.

Use the SMART formula to see how you can pay off your credit card debt this year.
  • Specific – Pay off your credit card debt in full in a year.
  • Measurable – By figuring out exactly how much you owe in credit card debt, you can make this goal measurable. If you are $2,500 in debt, your goal is to pay off $2,500 in credit card debt within one year.
  • Attainable – Ask yourself how much you can afford to pay towards your debt each month and stick to it. If you ever have a month where you can spare the extra dollars to put towards this goal, strive to do so. If you can put roughly $210 plus interest towards your credit card debt each month, you will have your debt paid for in a year. If you can contribute additional money, you might reach this goal sooner. However, keep in mind your goal is to pay off your credit card debt, so you must temporarily stop using your credit cards until your debt is paid off.
  • Relevant – Paying off credit card debt is something you should consider prioritizing for your financial wellbeing. If you have accumulated credit card debt, managing it proactively is a wise financial decision.
  • Time-Bound – By dedicating at least $210 plus interest every month to your outstanding credit card debt, you will have paid it off in-full within a year.

There’s no time like the present to take control of your finances. By implementing these 3 SMART financial resolutions in your routine, you are setting yourself up for a financially successful new year. At SouthState, our bankers are always here to offer financial advice and make sure you have the best products and services to fit your needs. Contact a banker or step into one of our 275+ locations today.

About the Author

Sara Raub currently serves as the Branch Manager at SouthState’s Columbia Clemson Road location. She is passionate about helping others find financial freedom and believes this is best achieved through a strong relationship with your banker.
Sara Raub  Branch Manager at SouthState’s Columbia Clemson Road location

  • This content is general in nature and provided for informational use only. Content may be used in connection with the advertising and marketing of products and services offered by SouthState Bank, N.A. and its subsidiaries and affiliates. This is not to be considered legal, tax, accounting, financial or investment advice. You should seek individualized advice from personal financial, legal, tax and/or other professionals, as appropriate depending on the specific facts of your situation. We do not make any warranties as to the completeness or accuracy of this information and have no liability for your use of this information.

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