The Aussie half-back joined Wildcats last off-season from Cronulla Sharks on a one-year deal and has now extended that until the end of 2013.
“I think Wakefield are definitely going in the right direction,” Smith said. “I think we’ve played pretty well this year.
“There’s been a few games when we’ve been inconsistent, but all-in-all I have been happy with my own form and the team’s and I am enjoying myself at the moment.
“It was a pretty easy decision to make. I like the way the team is, there’s a good spirit around the joint and I get on well with Rich [Agar] and the coaching staff.
“Hopefully next year we can have a good off-season and we’ll have had a year together under Rich and we might get in the play-offs.
“I still think we have a chance this year, so we’ll keep going and see how we go.”
The former Parramatta Eels and Brisbane Broncos play-maker had a spell with Wigan Warriors from 2008-2009, when he played just 21 times in Super League.
He insisted he is happy with a one-year contract and will consider extending that again next season.
“It is good to keep yourself on your toes,” he added. “Hopefully if I am playing well early in the year we can get something sorted again.
“I just want to get this season done first and then look forward to next year. I am really happy here and I am happy with the players here.”
Agar admitted signing Smith was a gamble, but he reckons it has paid off.
“When I sat down with him last year I think you could say his career was at a bit of a crossroads,” Agar said.
“It probably would have been viewed as a bit of a punt in some quarters, but I think we’ve been really good for Tim.
“As a staff, a club and his team-mates, we’ve played a big part in building his game back up and he’s grown within our team and gained a lot of confidence as the year’s gone by.
“He’s a very important player for us. Sometimes it’s difficult being a scrum-half in a team that doesn’t have the firepower of other teams, but as the season’s gone on and we’ve all got used to each other’s strengths and weaknesses he has proved what an instrumental player he is for us.”