Consumers monitor their goal progress to know how much effort they need to invest to achieve their goals. However, the factors influencing consumers’ goal progress monitoring are largely unexamined. Seven studies (N = 8,409) identified categorization as a novel factor that influences goal progress perceptions, with consequences for motivation. When pursuing a goal, categorization cues lead consumers to perceive that their goal-relevant actions are in separate categories; as a result, consumers anchor their estimates of goal progress on the proportion of categories completed and are less affected by the absolute amount of progress made than when categorization cues are not present. As a result, depending on the proportion of categories completed, categorization can lead consumers to infer greater progress when they are actually farther from their goal, and to infer less progress when they are closer to their goal. We demonstrate consequences of this effect for consumers’ motivation and goal attainment in incentive compatible contexts.