We all have financial goals we’re striving to meet. Maybe you have long-term goals like paying off debt, saving for a down payment, or retiring early. Or maybe you simply have day-to-day goals, like keeping your food budget to $200 per month, or bringing your lunch to work every day.
Whatever your goals are, you will inevitably face setbacks – you’ll give in to a moment of weakness, or just find that an unexpected event wreaks havoc on your plans. Life happens. But the important thing is not to let those setbacks impede future progress any more than absolutely necessary. Instead, follow these five steps to bounce back.
- Assess how much damage was done. If you simply blew your food budget by $5 on the last day of the month, you can probably just relax and start anew the next month. If you spent triple your monthly shopping budget on the first day of the month, though, you might have a bigger problem. So figure out how big of a setback you are really facing.
- Ask yourself why the problem happened. Was your setback a result of something that you could control? Were your goals unrealistic? For instance, you probably can’t save $1,000 a month if you bring home $3,000 and spend $1,500 on housing. Think about what lessons you can learn from this setback – how you can change your plans, behavior, outlook, or some combination of the three to set goals that are attainable without being easy.
- Determine if the setback is easily fixable. If you were $150 over budget in one category, but $200 under across other categories, you can kind of “reassign” your dollars and end up ok. If you “overshopped,” see about returning some things you haven’t used yet. And if you have an emergency fund but suddenly find yourself needing new tires months before you thought you would, there’s no need to worry about where the money will come from – that’s what emergency funds are for. But if there’s really a one-time event that just leaves you a little short of reaching your goals, let it go – almost all goals can be postponed briefly.
- Put steps in place to get back on track. If you fell $200 short of your monthly debt repayment goal, see if you can squeeze $50 per month from somewhere else for the next four months. A no-spend weekend can be just what you need to stave off disaster. If your problem was that you just didn’t have an adequate emergency fund, take steps to build one. If it truly turns out that your goals were just too hard to reach, see if your debt repayment can be stretched a month or two further, or that family vacation delayed to winter break instead of summer. And if the setback was something you should have foreseen and planned for, work on how you can do that next time.
- Move on. Don’t dwell on this one setback. Chances are it’s not going to ruin you financially. But dwelling on it could have emotional and ultimately financial ramifications. So put it behind you, and resolve to do better next month.