The need for everyone to have a financial plan will not be discussed here. We did it in one of our previous articles. This one is for those who understand this need and want to get started. First, you will need to find a good financial planner, which we have also discussed in one of our previous articles here. But a planner won’t tell you what to do, at least they are not supposed to. The financial planning process starts with you telling the planner what you want to do, and the planner figures out the best way for you to do it. In other words, you should have goals, and those goals should be SMART, which stands for Specific, Measurable, Attainable, Realistic and Timely.

Specific. “I want to retire early” is a good goal, but it is not specific. What may be considered early for some, others may view as late. Having a comfortable life is also nice, but some may need $40,000 a year to live comfortably while others think they need at least a million just to survive. Retiring at age 55 and being able to spend $40,000 a year is and example of a specific goal.

Measurable. Saving enough money every month may be a good idea, but it is not measurable. How much is enough? “I want to be able to save $500 each month for the next five years” is an example of a measurable goal.

Attainable. You can set a goal to save $20,000 for a down payment on a condo in two years. This goal is specific and measurable, but if your total income is only $40,000 a year and you are just covering your basic living expenses, achieving this goal may be too much of a stretch. It will put you in an unnecessary hardship and you will likely give up. Set goals that would require certain commitment and sacrifice, but not to a degree that will starve you.

Realistic. If you earn $100,000 a year, have no retirement savings, and your goal is to retire in 5 years and be able to maintain the same living standard, this may be impossible to achieve no matter how good your planner is and how disciplined you will be in executing the plan. Set goals that can be achieved.

Timely. Many people have goals to buy a car, a boat or go on a long trip one day. A goal of this nature must have a specific timeframe. This way your planner will be able to tell you what you need to do to make it happen. Unless there is a specific point in time, the goal is not much of a goal at all.

Once you set SMART goals, you can take them to your planner. This will not only save your and your planner’s time, but make your plan not just a document, but something that will really work for you and help you achieve your goals.

Nikolay Sisan is a Certified Financial Planner and freelance writer in Vancouver.