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Setting goals and using the SMART goal setting formula can greatly increase the likelihood of actually turning your hopes and dreams into a reality. Whatâ€™s more, according to a study at the Dominican University in California, sharing your goals with a trusted friend or family member will also increase your chances by nearly 45%. If you regularly report your progress on those goals to that same trusted partner, you chances increase another 32% to a staggering 77% increase in your success rate.
However, what happens when you add another adult to your financial goal setting processes? The reality that surprises no one who has been married for any length of time is that your chances of achieving your goals can plummet significantly. In fact, all couples understand how easy it can be to see discussions about monthly grocery spending devolve into insulting arguments over personal spending behaviors. Money is, after all, the number one topic of arguments among couples.
When you and your partner are ready to trade in the squabbling and the quarreling about money for productive steps that bring you closer together, use this list of activities to make your financial goals happen. Even when paired with another adult who has financial goals of his or her own, these steps can be remarkably effective:
1. Hold an annual financial planning meeting (retreat) to set short- and long-term SMART goals
2. Set up a weekly-huddle day and time
3. Adjust your spending or your goals monthly
Hold An Annual Financial Planning Session As A Couple
Each year, set aside a morning, afternoon or evening for just the two of you to plan your upcoming financial year. Ideally, this will take place in the late fall months, but if you have not held one before, now is as good a time as any. Some couples will do better making a formal date out of it, such as a going out to dinner, followed by the financial planning session, followed by a movie or even a mini overnight staycation at a local hotel. Other couples will do just fine with an informal discussion or two over breakfast or dinner in the kitchen. The key is to set the date and to address the following questions:
- What do we want to do this next year that will require more money than we can come up with from a single paycheck?
- How much money do we want to add to our regular emergency savings deposits or transfers each month?
- How much money will we need in order to fix/replace our vehicle(s) in the next year or so?
- Are there appliances, pieces of furniture or electronics that will likely need replacement or repair in the next twelve months?
- What is our plan for birthday and Christmas gift spending next year?
- Are we going to take a vacation or major trip, and if so, how much will we need and by when?
- Which debt repayment do we want to accelerate this next year, and how much do we want to add to our current monthly payments?
- What day of the week and what time of day will we set aside for 10 minutes to hold our weekly financial huddle as a financial power team?
Put everything in writing, meaning that one or both of you should be taking notes. Put the notes together and pull out the key figures. Write or print them on index cards that you can post in your bedroom, on your bathroom mirror, on your refrigerator, or to carry them in your wallet. If you are tech-savvy enough, upload pictures representing one or more of your goals as your phone or desktop wallpaper. The more often you see your goals, the more often you will think about them and the more likely you will be to achieve them. Finally, if you have attempted and failed to keep each other financially accountable in the past, each of you should sign the notes or the index cards so that you have tangible proof of your commitment to each other as teammates working toward the same, mutual goals for the year.
Hold A Weekly Financial Huddle As a Couple
Starting as soon as possible, begin holding your weekly financial huddle together as a couple. The purpose of this informal but critically important gathering is for you and your spouse to stay on the same financial page and to work toward the same financial goals. Here is how:
1. Start your huddle by looking over your annual, mutual goals and review the progress you are making toward each of them. Do not get bogged down in celebrating success or in looking for and assigning blame for failure. Adjustments happen monthly (see below).
2. One of you should balance the checking account ahead of time so you both know how much cash you currently have available to you.
3. Next, review all bills, payments, and expenditures coming up in the next two weeks. Be very clear about who will make the payments or spend the money, how much you expect to spend, and the form of the payment.
Here are three examples:
- â€œThe electricity bill is due next Friday in the amount of $125 and will be automatically deducted from our checking account.”
- â€œI will use $100 cash on groceries next Monday evening.â€
- â€œYou will set up an extra $250 online payment for the credit card bill.â€
4. Finally, revisit your goals together and ask the question, â€œWhat can we do this week to put another $10, $50 or $100 toward our mutual goals?â€ If, for example, you realize that you will be spending $50 less this week on groceries because your teenaged son is away at summer camp, decide who will add that $50 to the debt payment or the savings account.
Hold A Monthly Goal Review As A Couple
Every month, add to your huddle a little more in-depth review of your goals. Ask if you are on track or if you, instead, need to adjust your behaviors, your goals, or both. In simple cases, you might end up adding an extra $5 a week to your savings plan. In situations that are more complex, you may need to change or postpone a goal or two altogether due to unexpected expenses (e.g. medical emergencies). With these three coupleâ€™s meetings in place, you and your spouse may just find that the only thing you have left to argue about is where you are going to spend your next vacation. Who knew arguing could be so fun?