By Nate Matherson, Co-founder of LendEDU, a website that helps consumers learn about personal finance. Personally, Nate is working to payoff his student loan balance once and for all in 2020.

The end of one year and the beginning of another is fast approaching. While it’s tempting to focus on fun holiday activities during the festive season, it’s also an important time to consider your goals for next year. That’s because the beginning of the new year presents a fresh start and an opportunity to make resolutions that can improve your life over the long-term.

For me, many of those resolutions are financial goals. And, many other Americans will likely also be setting some New Years resolutions relating to money as well. To help you out with establishing your own goals, here are some tips I’ve discovered work well for me in thinking critically about my financial goals.

1. Pare down your list of goals and focus on what’s most important

Having too many resolutions can be daunting and make it difficult to keep track of your progress. Instead of making a long list of different financial objectives, focus on one or two things that are most important to you.

For me, my goals in 2020 are to pay off my student loans – I’m down to owing less than $20,000 – and to contribute more money to my 401(k). Others will likely prioritize their goals differently. LendEDU’s survey on financial goals, for example, found that 20% of Americans have set buying a home or apartment as their number one financial priority compared with just 19% whose top goal is retirement savings and 7% who are most focused on paying off student loans.

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Whatever your objectives are, pick one or two short-term and one or two long-term goals to set for yourself in the new year so you don’t get overwhelmed with all you have to do.

2. Be specific in the goals you set for yourself

Accomplishing goals is also a lot easier if you are very specific in terms of what you are hoping to accomplish. For example, I mentioned above that I want to contribute more to my 401(k). But, I’m not just listing “increasing retirement savings,” as my goal. Instead, I’ve set a specific target for myself – I want to save at least $10,000 by the end of the year.

Whatever you’re hoping to do with your money, you also want a detailed plan for how to accomplish it.

For example, 10% of survey respondents told LendEDU that their primary financial goal was building an emergency fund. If you hope to have your fund established by the end of 2020, figure out how big your fund needs to be – most experts recommend saving three to six months of living expenses – and when you want your fund to be built.

If you spend $3,000 per month on essential expenses and want to save six months’ worth of expenses, this would mean your specific goal should be to save $9,000 by December 31 of next year.


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By getting started on my goals at the beginning of a new year, I have a set date when I’ll first work on them – which feels good to me and makes it easier to get motivated. Setting a specific end date is equally as important so you have a timeline and don’t keep putting off getting your work underway.

3. Break your big goals down into smaller ones

Far too many resolutions fail because it’s too hard to figure out how to get started or what you should be doing during the year to be successful. To make sure that doesn’t happen when it comes to accomplishing financial goals, it’s helpful to break down big objectives into small ones.

For example, since I want to save $10,000 by the end of the year in my 401(k), I’ll figure out how much I need to save per month to hit that target by December 31, 2020. That means putting aside about $834 per month.

If your goal is to save $9,000 for an emergency fund, on the other hand, you’d need to move about $750 per month into a high-yield savings account each month to build your fund on schedule.

As another example, since I want to payoff my student loan balance by the end of the year, I am thinking about refinancing my student loan debt to a lower rate. Refinancing (again) would help to make my payoff faster and my monthly payments count for more! That means setting a date, ex. January 5th, for getting together an application, and spending a night actually applying.

By creating micro-goals to accomplish each month, I know exactly what I need to do so I stay on track to actually be successful. And I won’t have to scramble at the very end of the year when I realize my deadline is approaching – which may be too late to accomplish what I set out to do.

4. Track your progress

Setting goals is just the first step – it’s essential to make sure you’re actually doing what’s needed to accomplish each one. That means tracking how your efforts are going.

When you’ve broken down big goals into small ones, that’s a lot easier to do. I can just make sure, for example, that I’ve set aside my $834 each month in my 401(k) and made the necessary payments on my student loans to get them paid off each month.

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Tracking your progress allows you to quickly see if you need to make changes – such as cutting your budget to keep your savings on track. And it helps you stay motivated as you see how you’ve moved closer each month to accomplishing your objectives.

Set your financial goals today

Hopefully, this helps give you some ideas on how you can think critically about your own financial goals for 2020. I’ve got my goals set, so why don’t you join me in planning out your own priorities for the upcoming year. Having a financial goal to work towards and taking these steps to help you achieve it should ensure you end 2020 in a better financial position than you started it.

What are your financial goals for the new year? I’d love to talk about them in the comments below.

Additional Reading

Retiring By 45 appreciates Nate’s contribution! Additional information helps build a stronger financial foundation. To that end, check out this great article about how to buy a house if you have student debt.