A financial goal should have certain key characteristics to be effective and achievable. These characteristics are often summarized using the acronym SMART:

• Specific:

  A goal should be well-defined and clear, avoiding vague language. Example: Instead of "Save more money," a specific goal would be "Save $500 per month for a down payment on a house."

• Measurable:

  You should be able to track your progress and know when you've achieved the goal. Example: The goal should include a quantity, such as a dollar amount, percentage, or specific date.

• Achievable:

  The goal should be realistic and attainable given your current resources and circumstances. It should stretch you but not be impossible. Example: Saving $500/month might be achievable if you have a certain income and expenses, while saving $5,000/month might be unrealistic.

• Relevant:

  The goal should align with your values, needs, and overall financial plan. It should be important to you and contribute to your long-term financial well-being.

• Time-bound:

  The goal should have a deadline or a timeframe for completion. This creates a sense of urgency and helps you stay on track. Example: "Save $6,000 for a vacation within 12 months."

By following these guidelines, you can create financial goals that are more likely to be successful.