Setting goals is the first step to financial planning and can have a huge impact on your quality of life. It’s creating a road-map for handling everything you do with your money – spending, savings, using credit, and investing.
While reaching your financial goals may seem like a daunting task, these 4 steps will make the process easy, painless, and successful.
Step 1: Identity your values. What is really important to you? Values are not goals, but they help you define your goals. For example, if one of your goals is to save up for a house, then family or security would be your value.
Step 2: Define your goals and decide when you want to reach them. What do you want to achieve in 3 months? 2 years? 10 years?
Step 3: Create an Action Plan. Now that you know what you want and when you want it, do some research and assign a dollar value to each goal.
- For example, in 6 months I’d like to buy a laptop. Through my research I know a laptop costs around $600. By dividing the price($600) by the number of months(6) I have to save, I can see that I need to save around $100 each month. That’s only $25 a week!
Step 4: Keep your goals in front of you! Keep a picture of your goal in a visible spot so can remember what you are working towards when things get tough. Create a financial calendar to help you keep track of how much money you have saved. Setting financial goals is the easy part, in order to reach your goals you have to stay on track and stick with it!
Now that you know how to set and reach goals, go out and get started! You will be amazed by what you can accomplish.