Setting goals for the new year is a thing around this time. Besides I think it’s a good hype, I also think it’s important to set goals and pursue them. Because sometimes you may feel that you are not making progress with your debts or financial situation. You feel like you’ve been left behind. Maybe the budget you’re using isn’t working out the way you’d hoped.
What are financial goals?
A financial goal is a plan you have for your money. For example, a monthly budget is your financial goal for the month, while investing for your retirement is a long-term financial goal. The reason for goals is that they keep you focused and accountable.
Examples of Financial Goals
Here are some examples of financial goals:
- Payment of debts.
- Build a buffer for unexpected expenses.
- Savings for vacations, pension, school expenses for children.
- Start a business or pursue a course.
Why is financial goal setting important?
Ever wonder why setting these goals is so important?
Well, the reality is that most of the time, dreams and desires are fulfilled in terms of some financial investment.
It doesn’t matter if your goal is big, like buying your own home, trading in your car for a newer model, or taking an amazing trip abroad. Even with a modest goal, the reality is that a certain degree of financial planning and financial purpose will be required.
Think with us, if you have a dream, and you need money to make that dream come true, however, in the end you don’t take any practical action to get the necessary money to make that dream come true, it will be very difficult to make it come true, isn’t it?
This is why it is important to create structured and clear financial goals because they are the ones that will pave the way to achieving your dreams.
Keep in mind that often the gap between your dreams and their realization may not be a lack of money. Rather, its absence Proper financial planning And lack of discipline to follow that plan and achieve your goals.
How to set financial goals
1. Write them down
When you put things down on paper, it’s your focus. You see goals, so you’re consciously working on them, as long as the goals stay in your head. You can choose to write the goals on post-it notes and stick it on the fridge, mirror, mirror, etc. This will keep you focused.
2. Make your goals specific
Don’t just write: I want to manage money better. This is very confusing. It is best written as follows: This year I will keep my daily expenses in a cash book because I want to save.
3. Measure your goals
How much do you want to save exactly? Breaking your goals down into smaller goals will keep you motivated, as you can tick each smaller goal off the list.
4. Give yourself a deadline
If you don’t attach time to your goals, you won’t reach your goal any time soon. You can always adjust the planned time if you find you need a little more time.
5. Make it your goals
You may be impressed, but stay true to yourself. What would you like?
Reach your financial goals more easily with a precise financial roadmap
Know that there are no right or wrong answers when it comes to setting your goals. And no investment style is better than another, from the most conservative to the most aggressive. The key is to set a course and stay the course.
From there, achieving your goals is important, and your vision serves as the direction to evaluate every investment decision you make. From time to time, ask yourself if, by taking such action, you are achieving or moving away from your goal.
A roadmap can also be useful in times of market uncertainty, when there is a temptation to make hasty decisions. A clear vision, including specific guidelines, will guide you toward your ultimate goal.
Tips for achieving your financial goals
Now that you’ve learned all about financial goals, here are some tips to help you reach your goals:
- Define your financial goals in the short, medium and long term.
- Create a detailed monthly budget and track your expenses regularly.
- Set aside a fixed percentage of your monthly income for investment.
- Cut down on unnecessary expenses such as impulse purchases.
- Invest in financial education and learn about investing.
- Diversify your investment portfolio according to your investor profile.
- Stick to your financial goal even when things get a little tough. In time, you will definitely get there!
- But just focusing on planning isn’t enough, it’s time to take action.
Many people still think of savings as their first option for investing, but there are many options in the market that are more profitable and even safer, such as fixed income and treasury direct products.
Understand what short, medium and long term goals are
It is very important that you know how to set your financial goals and we have also explained the benefits of doing so for your life.
Conquering dreams and accomplishing goals is a personal achievement for many people, and money is important. Especially when these goals and dreams are big. So you need to know how to plan.
In order to strategically define your goals and life goals, and to know the best way to invest your money to reach each of them, it is important to understand the concepts of short, medium and long term, and we are going to talk about them now.
For the short term:
Thinking about the short term, your priority should be paying off your extra debts, especially those with high interest rates, such as credit cards and overdrafts.
Next, you should think about what your most urgent and urgent needs are, like a small renovation of something that needs attention in your home, for example.
Then it is possible to move on to bigger goals, and the realization of dreams that require some kind of big investment.
Medium Term Goals:
Regarding the medium term, now is the time to set relatively larger goals and objectives, which will require greater financial investment.
Consideration of medium-term objectives includes any goods or services that can be obtained within a maximum of 12 months.
When the focus is on the long term:
Long-term goals are aspirations that are more ambitious, requiring a longer period of time and more planning.
In this category are goals and objectives that will require the joint cooperation of family members, and will require more than 1 year to achieve them, and for the achievement of such goals, greater and more detailed planning is necessary.
One tip is to put down on paper how long you would like to achieve each of these goals, and how much money you would need to invest monthly to achieve them.
Examples of long-term goals include a family trip abroad, changing cars, or even buying a new house or apartment.
The result
When you don’t have a plan for your money, it makes it hard to achieve anything positive. This is why setting financial goals is important.
It’s never too late to be one. Pick up a pen and book today and plan to work cleanly on how you should finance yourself for the rest of the year, we wish you success on your new journey.