Many adults have similar financial goals in life. They’d like to buy or build their dream home, send their children to a good school or tertiary institution go on holiday to new and exciting places, start their own business, and even retire early. It’s a very good idea to have financial goals, as they help keep us motivated.
What are your financial goals, and how will you reach them? By thinking them through carefully, and categorising them accordingly (short, medium and long term goals), you can help set the path to future financial success.
Here are our top tips for helping you reach your financial goals.
- Create a plan for your goals, but keep them flexible.
What are your goals? Be specific. What do you have to do in order to reach them? Again, be specific and realistic. Do you need to work a certain amount of hours each month, is there something you can sell (products or services), or do you need to make a financial investment perhaps? Your plan should give clear answers to your questions of HOW you’re going to achieve your goals. Make sure you also allow for some flexibility though, as it’s hard to predict what might happen down the line. Whatever you do, don’t be put off by minor obstacles that come along (and which can derail your plans), these are simply part and parcel.
- Have realistic financial goals.
Want to be a dollar millionaire and retire by the time you’re 40? Me too! But let’s be realistic.Don’t bank on winning the lotto. Use your income (or expected income) to set yourself realistic goals in terms of what you can save and invest each month.
- Make your goals measurable.
Once you’ve clearly defined your goals in your plan, and have mapped out how you plan on achieving them, set timelines for each goal. This will help you determine which goals are short, medium or long term, and gives your plan focus.
- Short-term goals are those you hope to achieve within the next 1 – 3 years (a holiday or a new car for example).
- Medium-term goals are those you hope to achieve within 3 – 5 years (a deposit on a house, or renovations on your current home for example).
- Long-term goals are those you hope to achieve after 7 or more years. These are some of life’s biggest goals, for example retiring.
In short, the first step is laying out your goals, the second is determining how you’ll achieve them, and the third is to make sure they’re measurable, so you can “tick” them off as you reach them. Always remember, the fact that you’re thinking about your future, and what you want, already means you’re well on your way to reaching your life goals.