8 steps to achieve your financial goals

Goal-setting is important for you, because it compels you to look at the big picture of your personal finance.

Not having a goal means you don’t have an objective to work on as a way of making your money work for you.

Once your goal is set you can focus your energy towards achieving it.



It can be a short-term thing like a nice vacation, or something medium-term like a down payment for a car, or long-term like retirement.

The bottom line is you must work towards achieving your financial goal.

How do you do that?

In general you can go for whatever goal you want to achieve by following the steps below.

Let’s say you’re saving for a down payment so you can have a car. Here are the steps for you to follow.


Goal: Save P153,600 down payment for a car


Step 1: Study your current financial condition How much money are you making per month? After covering all your expenses, is there enough left for you to save for a down payment?

Do you really need a car, or are there more cost-effective options?

Once you’re able to save for a down payment, can you afford to cover the monthly amortization?

Knowing your current financial condition lets you know if the final goal of owning car is achievable.

Step 2: Establish a timeline Now that you know you really need a car, the next thing to establish is how much money you need to save over a certain period of time.

In our example, P153,600 is the 20-percent down payment on a car with a standard retail price of P768,000. Establishing a timeline gives you an idea how much you need to save each month. Let’s say you’ve decided on a three-year timeline –  that means you have to scrimp and save P4,300 a month, rounded out, to cover the down payment.

Step 3: Weed out your expenses Having an idea of your current financial condition lets you know if setting aside P4,300 a month is feasible for you. In case your budget falls short, find out what expenses you can cut so you can meet your mid-range goal of saving for a down payment. Be prepared to sacrifice some short-term comforts for this medium-term goal.

Step 4: Identify the actions to take You need to place that P4,300 a month somewhere. Opening a savings account is a smart move for a medium-term goal like a down payment for a car, because it lets you have easy access to your money without penalties.

You may also need to increase your cash flow in order to achieve your goal. Besides paring the rest of your budget to add to your goal, also explore options to add to your income, such as selling unwanted items by taking on side hustles, or beginning to invest.

Educate yourself on personal finance so you can make better financial decisions and achieve your goal faster.

Step 5: Monitor your progress It’s a nice psychological boost when you see yourself making real progress towards your goal. Every six months or so, check your progress and ask yourself, “Am I putting in as much money as I should to get my car in three years?” Be honest in your evaluation. Better still be shrewd in evaluating how you’re really doing. If you’re making good progress towards your goal, keep it up! If not, then it’s time to move on to the next step.

Step 6: Make adjustments Life is fast. The amount of down payment for your dream car may be adjusted for whatever reason, and you’ll have to cope with it. Or maybe your financial situation has shifted after your income stream has taken a hit, compelling you to adjust your goal.

Maybe you can pick a car that carries a lower down payment, or reconsider your need for a ride. If your income rises significantly, you can adjust your timeline by fast-tracking it to one year.

Maybe the rise in your spending power is prompting you decide on a different car, which means you’ll have to adjust the amount of your monthly savings.

Whenever something significant happens that impacts on your lifestyle or your income, reevaluate your situation and roll with the punches.

Step 7: Celebrate! Saving money can be a difficult task for some. So once you’ve saved enough for a down payment and driven your car out of the shop, give yourself a treat! Don’t go overboard, though by celebrating within your budget so you don’t feel guilty afterwards.

Step 8: Get ready for succeeding goals Now that you’ve achieved this goal, you’re ready to take on new financial objective, like paying for a new house, or creating a retirement fund.

Whatever your goal may be, you now have a roadmap on how to achieve it. It may not be easy, but you deserve your reward when you achieve it: your dream car, your dream home, or the good life when you retire. You just have to make a plan and stick to it.