5 Key Signs You’ve Lost Track of Hitting Financial Goals — And How To Turn It Around
Financial goals are made to help you get ahead with your money, but you may have fallen behind. In fact, you might not be totally sure where you stand with your finances right now.
If this is the case, don’t panic. Many people set financial goals, veer off course — often many times — and get back on track.
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Sometimes it’s glaringly obvious that you’re not currently on a path to achieve your financial goals, but not always — especially if you’re not paying close attention. Now that you’re on the lookout, here are five key signs you’ve lost track of reaching your financial goals along with some tips on turning things around.
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You’re Not Meeting Certain Financial Benchmarks
If your recent spending has been all over the place, Mykail James, a personal finance creator known as “The Boujie Budgeter,” said you can turn things around by going on a money date.
“Sit down to do the following — review your financial goals, review your current financial standing and write out an action plan to get back on track,” she said. “Sometimes you have to break out the wine and relax a little bit during this money date, but it will be worth it.”
Being honest with yourself about your current financial status might not feel great, but it’s actually a huge step in the right direction.
“After your money date, do a dance to celebrate your upcoming financial success,” she said.
You’re Overspending All the Time
If you’re constantly spending money you don’t have, it’s time to make a change. “Check your B.A.N.K.,” James said.
She described this as a simple framework with questions to ask yourself before making a purchase. “B is for bring,” she said. “What does this decision bring to you?”
She said A stands for affordable, where you should ask yourself if you can afford this purchase, and N stands for now, where you ask yourself, “Do I need it now?”
Lastly, James explained that K stands for knockoff, meaning you should ask yourself what the cheaper knockoff alternative is. “Once you’ve answered these questions, you can decide if the purchase is worth it.”
You’re Making Impulsive Buys
Spending money without fully thinking the purchase through can get expensive — fast. If you’re in the habit of making impulsive buys, it’s time to change course.
“Buying a few small things here and there might not seem like a big deal, but those purchases add up,” said Scott Lieberman, founder of Touchdown Money. “If you’re not taking your budget into account, you’re setting yourself up to fail.”
There are plenty of ways to curb impulse buying. For example, you can put yourself on a budget, make a shopping list — and strictly follow it — before walking into a store, or paying exclusively with cash.
You’re Using Credit Irresponsibly
Credit cards should be used for a reason, and that reason isn’t racking up debt. “Using credit cards to get rewards or to pay things off in a week or two is sensible,” Lieberman said. “Using it to survive is not.”
He said you need a reset if you can’t survive without credit.
If you’ve accumulated credit card debt, you’re not alone. As of the third quarter of 2023, the average credit card balance among U.S. consumers was $6,501, according to Experian.
The best way to go about paying off credit card debt is different for everyone. For example, you might opt for a balance transfer credit card, get a debt consolidation loan or follow a payoff strategy, such as the debt snowball method.
You Don’t Have an Emergency Fund
Life can be unpredictable. You might lose your job or get hit with an unexpected expense, which is why it’s important to have an emergency fund.
Generally speaking, you should have at least three to six months’ worth of living expenses in your emergency fund. If you don’t, it’s time to start saving.
Nearly one-third of people reportedly couldn’t handle an emergency expense of $500 or more right now using only savings. Saving enough money to cover three to six months of living expenses might feel unattainable. But you can get on the right track right now by starting in small increments.
Putting aside even $50 or $100 per month will add up. Plus, if you deposit the money in an interest-bearing account, you’ll get to your goal even faster.
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