The Power of Quarterly Goals for Your Money


If you’ve done any kind of planning, financial or otherwise, at any point in your life, you’ve likely hit an important question that can affect the success of those plans. That question has to do with timeframe–what’s too short and what’s too long?

When it comes to life planning, I cap out setting “goals” at one year–and even that timeframe is a little too generous. Anything longer than one year, my 5- 10- and even 20- year plan is more of a “vision” than a truly defined goal.

Beyond that, there are quarterly and monthly benchmarks that are easy to set with goals that require regular progress and that can be measured (already one of the key components of setting effective goals).

Finally, many personal effectiveness gurus advocate the weekly timeframe as the point where the rubber really hits the road–long enough for planning to have some meaning and flexibility, but short enough to keep things moving at a steady pace.

What About Money?

I’ve noticed that planning around money is very different from the personal life planning I’ve described. While we make financial decisions on a daily basis, we usually organize our micro-focused planning efforts around one of two things: our paycheck schedule or the months of the year. This is when bill-paying, budgeting, balance checking, and similar activities are most likely to take place.

With a micro-time frame of one month, when do we sit down for the macro-level planning? When do we set financial goals, rebalance portfolios, plan out taxes, write our wills, and everything else that’s critically important but rarely urgent?

Naturally, we look to the yearly cycle as a good one for setting financial goals. It’s one step up from monthly planning and we are usually out setting goals and resolutions around the New Year anyway. The problem is that one year is often too long to wait between solid planning sessions, and often even too long to visualize the effects of our goals.

How often do you find yourself scrambling in December to finish up the goals you set for yourself in January? At times, this is achievable, but with financial goals, it is rarely the case. Financial goals tend to be those that need consistent care, work, effort, progress, and maintenance. A year is just too long.

The Quarter

Over the last year or two, I’ve found myself experimenting with quarterly planning. It is far more tangible than a year–it’s hard to imagine what my life will look like on January 1, 2015, but April seems just around the corner. And it’s far more flexible than a month–if I can’t achieve something this month for one reason or another, I have two more shots at making things happen before the quarter is up.

I once read (I wish I could remember where) that we tend to widely overestimate what can be done in a day or a week, but widely underestimate what we’re capable of achieving with consistent effort over the course of the year. I’ve found this to be the case, and so the quarter seems like a good middle ground.

The other nice thing about quarterly goals is that you tend to start thinking about them in terms of chronology. Take my goal of finishing clearing my yard by the end of this quarter. Had this been a yearly goal, I might have written out a task list and left it at that. But as a quarterly goal, I’m automatically thinking about cutting back the palm trees in January, clearing more shrub in February, and planting new trees and landscape for the spring in March. The progression of what needs to be done is already in my mind because the due date seems so close.

The same thing goes for financial goals–whether you want to save a certain amount of money, pay something off, get a big financial project done (like putting together an emergency plan). All of these are things easily done within the time frame of one quarter.

The best part is that you get four chances to do it in the course of a year!

What are your thoughts about setting quarterly goals? Have you tried it in the past and has it worked?