Setting S.M.A.R.T. goals to buy your first home
How to set smart goals to buy your first home in 2022
2022 is around the corner and the first things on your mind are holiday shopping, cookie decorating and your Aunt Carol’s party where everyone wears less-than-attractive holiday sweaters.
If buying a home has been on the agenda for the last couple of years, we suggest easing off the gas on holiday spending and starting to plan how you can make purchasing a home in 2022 a reality. Take some time during this busy holiday season to sit down and lay out your goals for the following year.
How can you start planning? Every good plan has an end goal in mind. Goal setting might sound like something that only applies to entrepreneurs and business owners, but it is very effective for all aspects of life, including purchasing a home.
In this blog, we will discuss how you can set SMART goals to buy your first home in 2022.
What are SMART goals?
The first step to setting SMART goals is understanding what exactly they are. SMART is an acronym for Specific, Measurable, Achievable, Relevant and Timely.
Setting SMART goals is typically done to improve success in a certain area. Goal setting often ends with unachieved goals because they were either unrealistic or there was no clear roadmap that would lead to the goal being achieved.
SMART goals help you identify the actual steps you need to take toward the goal, understand how to track your progress, making sure it’s realistic and setting time parameters that will give you a timeline on when this goal needs to be achieved.
An example of a SMART goal would be: You have a goal to [quantifiable objective] by [ideal timeline or deadline]. [Specific people or teams] will accomplish this goal by [steps you’ll take to achieve the goal]. Accomplishing this goal will [result or benefit].
How can you be specific when planning to buy a home? A common goal is simply “we want to buy a home next year.” But this is a very broad goal. You may find that you have many different goals throughout your homebuying journey. It’s important to narrow down each goal, so you can successfully achieve each one.
Some examples of different specific goals you may have throughout the process would be:
-We are going to save $_______ for a four-bedroom, two-bath in [xyc town] within the next ____ months.
-We need to meet with at least three realtors in the next two weeks to decide who has the most experience as a buyer’s agent.
-I will meet with a credit repair agency once a month for the next 12 months while saving $500 a month in order to buy a home 15 months from now.
Specific goals give you a clearer focus on what needs to be done to make this goal a reality.
Like the goals we listed above, they need to be specific and also measurable. If your goal is not measurable, you won’t know how close you are to achieving it.
If you need to save $15,000, start setting smaller benchmark goals and give yourself small rewards every time you reach those benchmarks. For instance, make a paper chain and have each chain be your benchmark for hitting $1,000. Cut one chain off every time you save an additional $1,000.
Seeing your journey to the finish line will improve motivation and encourage you to continue pushing toward that goal!
While having a measurable goal is great, you’ll need to make sure it is actually achievable and attainable. Having a goal of saving $15,000 is much more doable than saving $50,000 in a year, depending on your income. Setting yourself up for success is key, so don’t set a goal so lofty that you’ll never achieve it.
Is buying a home aligned with the rest of your life? Do you see yourself traveling the world for the next couple of years instead of settling down? If so, maybe saving to buy a home is not what your next goal should be focused on.
Are you planning to have a family in the next five years? Buying a home would be more aligned with your plan to have a family and would be a building block for that plan.
Lastly, your goal needs to have a timeframe on it. Setting a time where you identify that you want this goal achieved is crucial for the entire goal setting process. Setting time frames allows you to understand exactly what needs to be done by that deadline. Then, you simply fill in the gaps.
It can be difficult to know exactly what you need to plan for when setting goals for becoming a homeowner. In order for a new homebuyer to understand all expectations, we’ve created a simple and easy-to-use Homebuyer Education course.
Set aside some time, and start planning!