In order to reach a destination, you need a map – which is why financial goal setting tips are essential if you want to bring your monetary dreams to life.
The old saying goes that if you’ve failed to plan, you’re unwittingly planning to fail. When it comes to managing your money, it’s also not an exaggeration to state that if you aren’t working toward anything specific – you’re likely to be spending more than you should. Financial planning and setting targets for short, medium and long term goals can also help to ensure that you’re prepared for all of life’s ups and downs, but where do you start?
How To Determine Your Financial Goals
Depending on your individual circumstances, desires, income and even general aspirations, defined financial goals will vary from one person to another. However, there are three primary pillars to consider that can apply to just about anyone when it comes to setting financial goals.
Short Term Goals: Setting (and sticking) to a day to day budget, building an emergency fund, paying down smaller debts like credit cards.
Medium Term Goals: Buying your first home, taking out the correct insurance policies, setting up a university fund for your children if applicable.
Long Term Goals: Have a solid retirement plan surrounding your superannuation, collecting investment properties, high interest savings accounts, aiming to be debt free.
The hardest part is often determining what these goals will look like to you, so write them down – think about all the many things that you would like to do, achieve or experience in your life. Include all areas such as relationships, career, leisure, personal growth and even health, as one way or another these usually link back to your financial situation anyway.
Once you have a clear vision in mind, it’s time to both prioritize these goals – and to add time frames and task lists to them. Exactly what do you need to do in order to bring these goals to life, and how long are you going to need to do so? Some will require decades, and others just weeks. By breaking them down into tangible, realistic targets, suddenly your financial goals become less overwhelming, and are a lot easier to achieve than you may have initially thought. This also translates to motivation, which is often the hardest part when it comes to sticking to goals of any nature. While this all sounds great on paper, are there any shortcuts or goal setting tips that can help to keep you on track?
Seven Financial Goal Setting Tips To Keep You Motivated
Most of us start any new year slightly more hopeful than we were in November, but the magic lies in keeping the momentum up, especially when it comes to managing your money – so are there any industry hacks when it comes to financial goal setting tips?
Be Accountable – Now that you’ve outlined some tangible financial goals to hit, how are you going to keep track of them? Check in with yourself regularly to keep track of timelines and targets – after all, you’re the one accountable for them.
Know Your Income – Financial professionals talk a lot about monitoring your expenses, but what about your income? Knowing exactly how much is coming in is just as important as knowing what’s going out, as it can help you to identify ways to potentially lift your income.
Use Technology – Since we now live in the digital age, there’s no need to spend hours mulling over an Excel spreadsheet to track your budget and outgoings. Use apps like Pocketbook or Money Brilliant to sort your daily spending, and others like Raiz to explore the stock market.
Know Your Credit Score – Unfortunately many Aussies only tackle their credit file once it’s too late – meaning that they’ve been declined for a loan, and they’re trying to understand why. Check your credit file regularly to spot any potential red flags and avoid future pain.
Needs vs Wants – Get into the habit of curbing excessive spending. Much like eating healthy, start addressing your “needs vs wants” with a regular spending routine instead of overdoing it with short term discipline. If you’re realistic, it’s more likely to stick.
Direct Debits – Don’t let your bills pile up, as this is a surefire way to put a spanner in the works when it comes to hitting your financial goals. Instead, break them down into smaller weekly direct debits into a separate bank account to avoid the larger annual bills.
Weekly To Do Lists – Long term financial goal setting can be daunting. While that five year plan looks good on paper, what do you need to do every week in order to get you there? It could be as simple as saving $50 in a term deposit, or even cutting down on takeout coffee.
Further Financial Goal Setting Tips From The Professionals
If you are ready to “level up” and get financially fit, then it’s never too early to seek professional financial advice. Whether your next goal is to retire early, take a gap year or purchase a home, George Samios and the team at Madd Life are ready and waiting.
With their entire business built on referrals, the team at Madd Loans have taken the mortgage broking industry by storm. Their overwhelmingly positive feedback has helped them to take out numerous industry awards, including the title of “Queensland’s Broker Of The Year” for four consecutive years. However, after working with a broad variety of clients in regards to their mortgage options, it made sense for the team at Madd to have the capacity to offer a full financial planning service.
If thinking about your financial future strikes a chord with you, then it might be time to speak to a professional. Whether you’re chasing mortgage solutions or a financial fairy godmother, the team at Madd work together as a collective to turn your goals into reality.