Prioritizing your financial future

Using SMART goals to motivate you to organize your financial life.

Prioritizing your financial future

A trio of words beginning with “P” could help organize your money issues: Prioritize….Plan…Practice! Tailor these steps to your situation. If you are coming up short on dollars each month for basic needs, you are not alone. But, knowing others struggle does not solve your problem. Planners handle their financial shortages with less stress and less troubles. Non-planners compound one crisis with another new crisis.

Prioritize – Get everyone in the household involved. Discuss differences between needs and wants. Sort expenses into five categories and scrutinize them carefully. Start with Housing, Transportation, Health/ Nutrition (food & medical), Job or school expenses, and Other. “Other” is where to group everything else on which anyone in the household spends money.

Plan – What is it you hope to accomplish? Do you feel you need more money to be successful? Do you earn enough money, but it seems to disappear before bills are paid? Are there special purchases you hope to make in the next few months? Are you concerned about long-term financial security?

One effective planning tool is creating SMART goals. This is an organized process for deciding what you want/need and making a realistic plan to achieve it. Look at a graphic example of a SMART goal.

Situation: You have an older refrigerator, that is not energy-efficient, and the door seal is starting to lose its suction. You want to get a new refrigerator before this one dies.

Written SMART goal: “I will save $1,500 to be able to pay cash for a new Energy Star refrigerator with a freezer on the bottom, in the next 6 months.”

Now for the last of the three “P” words: Practice – Make a spending plan for your household. Organization is the key to implementing and maintaining a spending plan. Determine income and expenses on a monthly basis. Use one of the practical financial organizing tools at

The budgeting form “Managing Your Money” is basic tool to organize your money. Print it out and fill in the blanks. If you prefer an electronic form, find additional options at: Michigan State University Extension offers a full menu of resources for personal money management at this website.

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