Have you ever made a financial goal, only to abandon it halfway through the year because you felt like it was impossible to reach? Or maybe you started off doing really well and then fell off the wagon, which left town and you stranded in the dust? There’s one secret to goal setting that most people ignore- and that’s setting financial milestones.
You know when you go on a hike and there are those little signs that tell you “4 miles to Lake Wonderful” and “1 mile to the best swim of your life”? Those helpful signs are milestones that let you know that you are headed exactly where you intend to go.
When you set financial goals, you need a series of small, helpful signs along the way to be sure you don’t veer off track. These are financial milestones and they are the key to staying in the driver’s seat of your wagon and your life.
Here’s how you can set financial milestones so you keep those dollars rolling in and move closer to the life you really want:
Set Your Goal
The first step to setting financial milestones is to set your big goal for the year. Goal setting is an art unto itself and you want to be sure you think carefully about what you really want and how getting it will impact your life.
Once you have a clear vision for your life, and what goal will help you get there, assign specific numbers to your goal. Stay away from vague statements like, “I want to make more money”.
Instead, get as specific as possible with your goal. Financial goals should include two sets of numbers. The first is a number that relates to the goal like, “I want to make $20,000 more this year.”
The second is your time frame for the goal like, “in the next 12 months.”
Specificity can transform a blah-maybe-I-can-do-this goal into a goal that you feel passionate, and empowered, to go after.
Not convinced? Which of these goals do you feel more fired up about?
“I want to make more money this year” or “I want to increase my sales by $20,000 in the next 12 months.”
Specificity for the win.
Set quarterly milestones
Now that you have your goal, it’s time to start setting financial milestones so you can stay on track. For annual goals, I start by breaking the goal down into 4 financial milestones that I can hit every quarter.
Factors to consider when breaking down your goal into quarterly milestones are:
- What time of year you earn the most
- What time of year you earn the least
- Launches, promotions, or sales you plan to have
- For new products or services- the time of year these will sell best
- Vacations and time off
For example, perhaps you always take a month off in the summer, travel for the holidays, and are planning two launches next year. Your quarterly milestones may look something like this:
- March 30th- $7,000 increase in profits (Launch #1)
- June 30th- $3,000 increase in profits
- September 30th- $7,000 increase in profits (Launch #2)
- December 31st- $3,000 increase in profits
Set monthly milestones
Creating quarterly milestones means that you are primed to set your financial milestones for each month. Just like setting quarterly milestones, you want to factor in what you know about your business and your plans for the year.
Using the same goal, here are the monthly milestones:
- January- $1000 increase in profits
- February- $1000+
- March- $5,000+ (product launch)
- April- $1,000+
- May- $1,000+
- June- $1,500+
- July- $0 (month off)
- August- $1,500+
- September- $5,000+ (product launch)
- October- $1,000+
- November- $1,500+
- December- $500+ (2 weeks off)
Looking at the monthly milestones, this big goal of a $20,000 increase in sales is looking more and more doable!
Now it’s time to strategize! You have developed clear financial milestones to reach your goal and now you can plan your business activities around these milestones.
For example, in addition to your product launch, you could run promotional sales of your products or services during the slow months. Or you could add a smaller mini-product or service to boost sales.
Next to every milestone, make a list of strategies and action steps you will take. You now have a detailed map of financial milestones leading you in the exact direction you want to go.
Create stretch milestones
It’s always good practice to add stretch financial milestones to your big goal. These will help you push yourself towards your personal edges and be a catalyst for personal and business growth.
Choose at least 2-3 months and figure out how you can really stretch yourself to double your original milestone.
Double you say? No way!
Yes way. You will be surprised by how much further you can go when you commit yourself to it! Revisit the action plan that you made and ask yourself, “What strategy have I not thought of? What’s missing from this list?”. Add those strategies to your plans and create your stretch goals.
Look at your milestones daily
The last step to setting financial milestones is to write them down somewhere that you will always see them. That means getting them off of the computer screen or scratch paper and putting them where they can be loud and proud.
Some ideas are:
- Your planner
- Your digital calendar
- On chart paper pinned on your office wall
- On a wall calendar
- On a post-it tacked to your computer or laptop
- In a beautiful frame on your desk
Do not shove your milestones into a dark, messy drawer in your office. By doing this you are saying that your milestones (and your dreams) that they aren’t important enough to be cared for.
Make your goals and milestones visible- not only to remind yourself of what you need to do to have the life you want but also to remind yourself of what you’re capable of doing.
What’s your financial milestone this month? What’s your big financial goal for the year?