Financial plans help you determine where you’re going with your money. Partly aspirational, these plans can help you create a strategy for paying off all of your debt while saving for a new house at the same time. When building your financial plan, follow these three steps:

Step 1: Determine where you’re going.

These goals will become the driving force behind your overall plan. Your list should include your short-term, mid-term, and long-term goals, and it should be realistic and specific. Short term goals are within one year, while mid-term goals are between two to five years and long-term goals are greater than five years from today. For example, if your medium-term goal is to buy a new car within the next three years, research the car you’re interested in and how much it costs. Your goal could be based on how much you’ll need for a down payment or perhaps to pay for the car in full with cash. Then, determine your target purchase date.

Step 2: Build in milestones.

Create 'small wins' along the way that motivate you to stick with your financial plan and reinforce the progress you are making. These small wins become the key milestones of your financial plan. For example, if one of your goals is to pay off the debt you’ve accumulated on two credit cards within the next five years, one of your milestones might be to pay off the credit card with the highest interest rate within two years and the one with the lower interest rate by the end of that five-year period. With this plan in place, you would have a goal around which credit card to pay down first. With the pay down of that first credit card, this can serve as a small win that can then empower and keep you motivated to pay down the second card.

Step 3: Set your monthly goal.

Once you know how much you need to save and how long you have to save it, you can set a monthly savings goal. Then you can see where that goal fits in your budget. If you find that you can’t save as much as your goal requires, take a look at your spending and see if there are places you could make adjustments. If that doesn’t seem feasible, you may need to move your target date for achieving the goal, change which goals you prioritize first, or look for new ways to boost income or trim expenses to help increase savings.

Creating your financial plan takes a significant time investment at first, but documenting your goals can help you save time and money in the long run. With a plan in place, you can set milestones and celebrate the achievements that will keep your finances healthy today – and for years to come.