I’ve always been intrigued by the power of goal-setting. As a psychiatrist, I often work with my patients to set both short- and long-term goals in their treatment, including making lifestyle changes, going to therapy, and managing stressors in different facets of their lives. Some goals are more powerful, more intentional, or more likely to be achieved than others that fall by the wayside. You have to wonder: what makes a goal more likely to be followed through on vs. one that is forgotten?
I’ve set goals in multiple areas of my life along the way—some explicitly stated, and others merely formed in my mind. There are goals to meet for competencies during medical school and residency in order to be promoted to the next year or to graduate. Many of us, especially in employed positions, are required to set annual goals that may be tied to a bonus, promotion, or renewal of contract. Whether the goals were met needs to be assessed at the end of a specified timeframe, so they cannot be overly broad and need to be tracked in a relatively easy way.
Enter: SMART goals—Specific, Measurable, Achievable (or Attainable), Relevant, and Time-Based.
Here's my approach to goal-setting and how I incorporate SMART goals into my overall strategy.
Should You Write Down Your Goals?
Writing down goals may make it ~42% more likely that you will achieve them. Written goals can help you change how you think about and approach them. Writing can help you to clarify, define, or delineate your goals in a more purposeful way. The language we use around goals matters, too. Using words like “I will” or “I commit to ”instead of “I should” or “I would like to” gives a more deliberate tone. Other benefits of writing down goals are:
- You will remember them better and have something to refer back to if needed.
- It is easier to track your progress or make course corrections.
- Putting down your thoughts on paper can make you feel less overwhelmed than having ideas flying around in your head.
- Seeing the goal in front of you helps to increase motivation and strengthens your commitment.
- Creates a sense of responsibility and accountability to yourself (and potentially to others if you share them).
What Are SMART Goals?
Hopefully, many of you are already familiar with setting SMART goals. You may have been introduced to this concept at work or in other settings. SMART goals are a much more detailed and intentional way to set goals. It gives a foundation or framework from which to build goals from nebulous ideas to meaningful pursuits.
The problem with setting vague or non-specific goals, like saying “I want to lose weight” or “I want to get in better shape,” is that there may be less motivation to follow through and no way to measure or track if the goal has been met. With SMART goals, you can set small or large goals and objectively see when they are met. It is also easier to enhance or develop new goals once the current ones are achieved. Hopefully, achieving the desired outcome of the goal only reinforces this strategy and provides motivation to set additional goals.
I’ve often thought about my financial goals and have acted on many of them, but about five years ago, I decided to write an annual list (perhaps not coincidentally, that was also the first year I attended WCICON in Phoenix). I’m a big believer in not making things overly complicated, so I jotted these down in a notes app on my phone where they are easily accessible and where I can regularly check in and set reminders. I try to make sure that each one meets the SMART goal criteria so I can see how I did at the end of the year.
Specific
Just like you may have set a goal to “become a doctor,” many steps went into achieving this goal. There were multiple checkpoints to get there, including graduating college with good grades, taking the MCAT, applying to medical school, taking licensing exams, applying to residency or fellowship, taking board exams, etc.
This goal can be made more specific by breaking it down into smaller pieces. Even a goal like “apply to medical school in 2026” is more specific but does not delineate what the specific steps are to get there. A specific goal might be to register for the MCAT or for the USMLE by a certain date, specify a study schedule or prep course to sign up for, and/or set a target score.
Another example would be an ambiguous goal like: pay off debt. This leads to many additional questions. Which type of debt to pay off first? How to tackle the debt? On what timeline should the debt be paid off?
A goal I had in mind was to pay off my mortgage early. We can debate the psychological vs. financial merits of this goal, but nevertheless, this was where I wanted to put my focus. I refined this goal by specifying that I want to pay off the mortgage by the time my children graduate from high school. An even more specific goal would be to set the amount you will pay ahead on the mortgage every month and a specific deadline. For example, I will put $1,000 more toward mortgage principal each month and have it fully paid off by December 31, 2027.
Measurable
Goals can be measured in multiple ways, but for many goals, you need to have some sort of objective data you can track. Making a goal to “save more,” “invest more,” or “spend less” is a good start, but it does not get you very far with how much that entails or what that means.
The easiest way to make something measurable is to add a number or value to the goal. This could be a specific amount—like maxing out my annual 401(k) contribution with $24,500 this year (broken down into smaller intervals), putting $5,000 (or whatever amount is feasible) into my brokerage account per month, or increasing the brokerage contribution amount by $100 per month on an annual basis. It could be a percentage, like saving 25% of my pre- or post-tax income. Or it could be to save a set amount into a child’s 529 plan on a monthly basis and increase it by 10% every year on the child’s birthday.
The point is that setting a numerical value makes the goal clearer and simpler to formulate and track.
Achievable (or Attainable)
One of my goals several years back was to automate my taxable brokerage account contributions on a monthly basis. Previously, I had been manually investing every month, but I would occasionally forget or skip it. This goal was easily attainable since I was already doing most of the work for it. In fact, automating it made it less work for me and one less thing to remember.
At WCICON a few years ago, WCI founder Dr. Jim Dahle talked about establishing a “20s fund” for his children. I had already been saving in my children’s 529 accounts since they were two months old and had opened a UTMA brokerage account many years prior for them as well, but after hearing his talk, I set up an auto-invest into their UTMA brokerage accounts to work on building their 20s fund.
It’s important for your goals to align with your reality, including consideration of your current lifestyle, spending habits, assets, debts, and disposable income. I’d love to set a goal to be a billionaire, but that is highly unlikely to happen. However, based on my current income and minimal debt, I can set reasonable goals that I am likely to achieve, like having a 25% overall savings rate.
Relevant
Your goals should be aligned with your overall financial plan and values. A goal should be related to whatever categories you are focused on, such as savings, investing, paying off debt, protecting assets, or charitable giving. It should be meaningful to you, including consideration of your phase in life, personal obligations, ideals, and perspectives.
An example can be to increase a commitment to charity by setting aside a percentage of your income, setting an amount annually for charitable donations, or opening and funding a Donor Advised Fund (DAF)—one of my personal SMART goals for 2025. It could also be to achieve enough financial security to cut back on work hours by a certain age. Connecting your goal to a larger purpose can help you make significant strides toward attaining it.
Time-Based
Similar to measurable, adding a timeline—such as a start date, interval, or deadline—can be very effective. It could be a date such as when you would like to have your student loans paid off by or a target date to pay off your mortgage early. Maybe the goal is to take out a 15-year mortgage instead of a 30-year mortgage or to invest a specific amount within a certain timeframe.
Putting It All Together
Putting all of the above factors together into a goal is what makes it SMART. It’s important to account for each element. If a goal still seems too unspecified, some easy ways to transform a general goal into a SMART goal are to:
- Add a number (amount, percent, multiplier, etc.)
- Make a deadline or timeline (monthly, annually, longer-term)
- Create an action step or steps
- Categorize it (spending, saving, investing, paying off debt, etc.)
- Specify a cadence to review, update, or complete the goal
Using AI to Generate SMART Goals
I am by no means an early adopter, but I have recently experimented with using AI to give ideas for goals that fit within the SMART framework. Come up with a preliminary or non-specific goal and plug it into a preferred AI platform. An AI prompt could be something like:
“Create a SMART goal around spending/saving/investing/retirement planning/debt management for a high-earning professional, such as a physician, with multiple examples of outcomes. Provide a breakdown of the goal for each of the individual SMART categories.”
It can at least give you a jumping-off point and help you brainstorm or develop your nascent goals. This approach allows you to pick or adapt the ones that make sense for you and your financial plan. I used Microsoft Copilot to help me craft my work-related goals in a SMART format for the first time this year, and it saved me significant time and gave me plenty of ideas that I could use to narrow down to my final version.
SMART Goals in Other Contexts
In addition to setting SMART financial and work goals, I’ve also used the SMART conceptualization to set personal goals, professional goals, and even goals around increasing my impact on environmental sustainability. In all of these areas, using the elements of SMART goals has helped me to be more thoughtful and strategic in my goal-setting. I cannot say that I have achieved every goal, but it has certainly helped to have a more conscious method.
Hopefully, you are convinced of the advantages of SMART goals in setting financial (and other) goals with intention and accountability. If nothing else, who really wants to set “dumb” goals anyway?
Have you set goals in the SMART fashion? Has that technique helped you achieve those goals? What other tips have worked for you in goal-setting?
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