Setting Financial Goals
Identifying financial goals is just as important as making them
happen. You have to know what your goals are before you can figure
out how to achieve them. And once you set up your goals, you need
an action plan to turn them into a reality.
Goal setting: step by step
There is no right way to develop financial goals, but the following steps
and our goal
setting worksheet will certainly get you started:
- Determine your short-term goals. Think about what you'd
like to achieve in the next three years (buy a house, pay off
credit cards, deposit $100 per month into an investment account).
- Determine your long-term goals. Decide what you'd like to achieve in ten years or more (pay off mortgage, retire at age 50, buy a second home). In some cases, your short-term goals will help you achieve your long-term goals.
- Make your goals specific. They should be concrete and
measurable. For example, "I want to retire rich" might be better
phrased "I want to be able to spend $5,000 a year for travel after
I retire at age 65."
- Make your goals actionable. What specific steps will
you take to achieve your goal? Perhaps contributing more to your
401(k) plan or packing instead of buying your lunch every day.
Whatever your goal, it needs an action plan to make it a reality.
- Take action immediately. Whether you start by making
a phone call or looking up information, your goals will feel more
real and attainable as soon as you take action.
- Make a list of your goals, review it often, and share it
with family and friends. Constant reinforcement and support
are invaluable to achieving your goals.
- Don't give up. If things don't happen as you originally
planned, don't give up; instead, redefine your goal or action
2 of 6: Setting Financial Goals
Copyright © 2007 MsMoney.com. All Rights Reserved.