When starting a new period of the year, quarter, or month add financial goals to the list and watch your financial life change forever! Save yourself some time AND money by focusing on the right financial goals! Keep reading to discover what they are.
“You must gain control over your money or the lack of it will forever control you.” – Dave Ramsey
Setting goals help you plan ahead for the future. It forces you to sit down and get crystal clear on what you want in the near and far future.
When you don’t set financial goals or goals in general, you are more likely to continue to not achieve that which you desire and/or continuously live a mediocre life.
Set yourself up for success by using these top financial goals to plan and prepare for your financial future.
This post is all about financial goals.
Financial Goals
In order to build your financial future, you must plan for both now and later. You must set short-term financial goals and long-term financial goals.
When setting financial goals, be sure to have a clear purpose behind your reason for wanting this goal to happen.
Create a budget and track your spending to ensure progress is being made toward your goals.
Read on: How to Create a Monthly Budget
How to create financial goals
The simple way to create a financial goal is by writing down a list of purchases you want to make in the coming month, quarter, or year.
Purchase examples:
- House
- Vacation
- Car
- Luxury Item
- Home decor item
After you have your list, write down how much it will most likely cost.
Lastly, set a deadline to reach this goal. For example, you can set a goal to save $5,000 in 5 months to start saving for the down payment on a house.
A goal I have is to have an emergency fund of $24,000 in 4 years. I work backward from there.
It means that each year I need to have $6,000 saved to reach this goal. Continuing to work backward, informs me that I need to save $500 a month to reach this goal in a year.
You can continue to work backward from there to figure out how much you would need to be saving weekly, but since I get paid monthly as a teacher, I heavily focus on monthly financial goal setting.
Short-Term Financial Goals:
Short-term goals are goals that can be met within 1-4 months. I like to think of these goals as monthly goals usually. Each month, we should be doing something to work toward reaching our long-term financial goals as mentioned in the example above.
Short-term financial goals examples:
- Save 20% of your paycheck
- Add at least $400 to a home investment savings account
- Begin saving for a big vacation (Trip to New York)
- Create envelopes and implement the cash envelope system
Long-Term Financial Goals:
Long-term financial goals are goals that are meant to be met in several years to come. You need to be thinking about where you want to be financially in 5+ years.
Think about the age you’d like to be when you retire and stop working. Do you own a house? Long-term goals can consist of purchasing one or paying off your mortgage.
Long-term financial goals examples:
- Add $50,000 to Emergency Fund within 5 years
- Retire by the age of 35
- Have a portfolio of properties
- Eliminate all non-mortgage debt
- Save for your children & their education
- Family vacation trips
How to reach your goals
Now, setting goals may very well be the easiest part of all of this. It’s easy to say, “I want to save $5,000 in 5 months.” Of course, we can reframe our minds and think, “I am going to save $5,000 in 5 months.” but having a plan and a course of action will help you get there.
Here are some things you can start doing today to help you reach your financial dreams:
- Keep track of your spending
- Have a weekly finance date with yourself
- Cut unnecessary spending
- Spend less on your wants and focus on your needs
In closing,
If you want your financial goals to come true, make a plan, follow these easy tips and watch your life change forever!
What are some financial goals of yours? Leave a comment below!
This post was all about financial goals.
