A financial goal is an objective to aim for when managing money. It can involve saving, spending, earning, or investing. Financial goals shape your future by affecting the decisions you make today.
For instance, if you set the goal to pay off some of your debt, you would make wiser choices based on that goal. You would be more inclined to eat out less, buy fewer unnecessary items, and save where you can.
More than likely, if you did not secure that goal, you would fall deeper into debt.
To prevent that from happening, setting realistic financial goals is a must. It is essential to add your financial goals to your budget.
That way, while you are creating your budget each week, you also leave room for you to reach your current goal.
Remember, a goal without a plan is chaos, and a goal without a date is a dream. Plan out how much money you will need to set aside each week with a date in mind when you need to reach your goal.
Even if you fail, you have learned how to better spend your money.
Here are five financial goals you can set today.
1. Start a Retirement Fund
Saving for retirement is a long-term investment. It is a goal you could work towards your entire life.
Although long-drawn, a retirement fund is highly beneficial in the long run.
You will want to closely consider your retirement demands when deciding what type of retirement fund to open.
Start as early as possible to get the best results in the end.
2. Fun Savings
Most financial goals are necessity-oriented. But while unnecessary, fun savings keep you going.
Having one goal you genuinely look forward to keeps your mindset on reaching your other financial goals.
Some examples of fun saving goals are saving up for summer trips, a boat, a big flatscreen TV, or anything else you like. The possibilities are endless. It all depends on what you desire.
And with the work of saving for these items, you will feel accomplished and deserving once you have the money to get them.
3. Emergency Fund
Life is chaotic and irregular, which means you never know what may happen to your current earnings.
Keeping an emergency fund gives you wiggle room for when unexpected events take place. Because let’s face it, they will. You will have to plan your emergency fund carefully, researching, as well as thinking ahead.
For example, each hospital stay costs an average of $15,734. Saving towards that expense, keeping in mind your insurance coverage, would be a good start.
You can also put away money for incidents like job loss, accidents, broken appliances, and car repairs. Being prepared can relieve a lot of stress now and in the future.
4. Pay Off Your Car
A new car is nice but a monthly car payment, not so much. Getting rid of this payment completely might take a few years, but it is a relief to reach this goal.
Again, having a plan as to how you are going to accomplish this will take you far. Include the car payment in your budget and set aside a portion of your income to pay off the extra.
Once your car is paid off, don’t buy another car until you have a sizable down payment ready.
Driving an old car might not feel so great, but it’s an accomplishment in itself to have something paid off, no strings attached.
5. College Education
Whether you’re a student paying off your balance or a father saving for your child’s tuition, college is a tangible goal on which to base your budget.
It is a long-term goal, but a valid one nonetheless.
Money operates almost all aspects of life. Getting control of your finances is one of the best things that you can do for yourself.
The first action is to set realistic financial goals that you can work toward.
Now that you have some ideas on what goals to create, use some self-discipline and work towards them.
Set aside time to plan out your schedule and budget. Then, shoot for the stars and make it. You can do it!