How to set clear financial goals

IN SHORT: If you want to win with money, don’t keep your financial goals in your head. Put them on paper and tell a friend.

Reaching your financial goals doesn’t happen by luck. It happens when you are clear about what you want.

Research from the Dominican University found that people who wrote down their goals achieved far more than those who only thought about them.

Another study by the American Society for Training and Development showed how your chances improve as you take each of these steps:

Deciding when you’ll do it: 40%
Writing it down: 42%
Making a plan: 50%
Committing to someone: 65%
Having regular check-ins with an accountability partner: 95%

Before you set financial goals, you must understand what you spend your money on.

Look at the last three months of your bank statements and draw up a list of expenses to see what you spend your money on – you might be surprised. Maybe you spend the same amount on takeaways as on groceries!

Draw up a budget and allocate specific amounts to specific needs i.e. groceries, transport and electricity. This will enable you to see where you can free up money to save towards your goals.

You don’t need to reach all goals at once. They will change as your life changes — and that’s normal. What matters is that your goals are realistic.

Short-term savings

Save for a flat screen television, December holidays or household items instead of borrowing or going into debt.

Pay off debt

Start with paying off high-interest debts like store accounts, short-term loans and credit cards.

Retirement savings

Invest enough to retire comfortably at 65. This retirement calculator can help you understand how your contributions — and the age you plan to retire — affect your final income.

Emergency fund

Aim for at least three months of essential expenses.

Use this simple formula: (Net salary × 3) ÷ Monthly amount you can save = Months to reach your emergency fund.

Getting a qualification to grow your income

A qualification can lead to better-paying jobs. It’s a simple investment that boosts your earning power.

Starting a side-hustle or small business

A side-hustle gives you extra income and reduces your reliance on a salary. Over time, it can grow into a small business with more stability and opportunities.

Long-term savings

Invest money for a down payment on a car or a house.

How to reach your goals

Step 1

Write down your goal and what it costs in today’s rands.

Step 2

Choose a date for when you want to achieve it.

Step 3

Work out how much you need to save monthly. If the amount is too high, adjust the goal or the time frame. Use free budget apps and online savings calculators and retirement tools.

Step 4

Choose the right savings or investment product.

Step 5

Automate your debit order — consistency is everything.

Step 6

Pick a trusted friend or colleague as your accountability partner.

Nomnikelo explains….

Sihle, a 27-year-old admin assistant from Soweto, wants to upgrade her life by getting her first laptop. She knows this will help with online courses, side-hustle work, and better job opportunities.

She checks prices online and finds a good entry-level laptop for R7 800.

Step 1: Set a clear target and deadline
Sihle decides she wants to buy it in 12 months.

She calculates: R7 800 ÷ 12 = R650 per month.

Step 2: Check your budget honestly
Sihle goes through her spending and realises she can find R650 if she cuts back on:
• Late-night Uber Eats
• Weekly takeaway coffees
• A prepaid phone bundle she doesn’t fully use

These cuts don’t affect essentials like transport, rent, data, or helping at home.

Step 3: Pick the right place to save
Sihle opens a bank savings pocket linked to her main account because:
• It keeps the money separate, so she’s less tempted to spend it
• It earns some interest — more than leaving it in her normal account
• She can still access it if she faces a real emergency

Step 4: Automate the discipline
She sets a R650 debit order to go off on payday before she spends anything.

Step 5: Get accountability support
Sihle asks her cousin, Thando, to be her “goal buddy”. Every month she sends a WhatsApp selfie with the message: “Laptop Fund Check-in: Month X — Current balance: R____”
This keeps her motivated because someone else knows what she’s working towards.

Step 6: Review
At year-end she checks:
• Has her salary gone up?
• Can she increase the R650 to finish early?
• Is R7 800 still the right laptop target, or has she found a better deal or shorter-term special?

After 12 months, Sihle hits her target — plus a bit of interest — and buys her laptop cash. No debt, no stress. And now she can study online and start earning extra income by designing CVs on the side.

Further reading
Budgeting 101: Needs vs Wants
Saving vs Investing
Set clear savings goals
Why should I budget?

Sources
Smart About Money: Watch: Setting savings and investment goals
Your Money Line: Top Examples of Achievable and Clear Financial Goals

Funded by