I’m dedicating my first post to financial goals because setting goals is really the first step in any process. Now, you do not necessarily need to write these goals down (but feel free to!). What I mean by setting financial goals is figuring out what it is you want to accomplish. The reason this is so important is that every goal requires a different path, different techniques, or different choices. For example, if your number one goal is to pay off student loan debt, you shouldn’t be setting your money away into an online savings account or investing in the stock market to achieve that goal (look for posts coming soon explaining why this is not the best option in this case). Below is a list of some common financial goals. Think about which relate to you and make a list (mentally or physically).
- Increase your credit score
- Pay off student loan debt
- Eliminate credit card debt
- Buy a house
- Purchase a car
- Create and stick to a monthly budget
- Save X% of income a month or $X a month
- Save for college
- Cut unnecessary spending
- Create an emergency fund
- Increase retirement contributions
- Invest in the stock market
- Buy an investment property
- Go on vacation
- Become more financially educated
- Save for wedding
- Home remodel/renovation
You may be thinking that some of these don’t particularly sound like a “financial goal,” such as purchasing something. For the average person, making a big purchase requires financial planning, though, in that you generally need to save money before being able to make the purchase or you need to plan out how this will affect your budget.
Once you’ve determined your goals, be sure to prioritize them to figure out which you should start working on first. Now that you’ve established and ranked your goals, look back for future posts relating to how to achieve these goals, as well as potential pros and cons associated with different ways you can achieve these goals (i.e., cash, credit cards, loans, etc.).