Do you struggle with meeting your financial goals? Perhaps you set them, save a little, and then end up throwing caution to the wind and spending the money you’ve saved on something else. Everybody has done this to a degree, but we should all have various savings funds to ensure we don’t have to worry. For example, an emergency fund can be massively helpful for times you may need time off work sick, or if you can’t work as many hours anymore. If you want to know how to set financial goals that you can actually stick to, read on:
1. Create A Budget And Live By It
The first thing you’re going to need to do before you set financial goals is create a budget that you can actually stick to. A budget doesn’t have to mean scrimping and saving, depriving yourself of things that you like. It simply means knowing how much you have coming in and going out, and then how much you’re going to spend on things like food, entertainment, and so on. If you plan this beforehand you can then put some money aside for emergencies and savings while still enjoying what you can.
2. Make An Emergency Fund Your Top Priority
An emergency fund should ideally be your top priority. Saving for anything else without an emergency fund could mean having massively depleted that account if you need a hospital stay or something else happens. Try to save 3-6 months or more of bills. More is better, but make sure you have enough to live for 3 months minimum to start with. Prepare for the worst and leave this fund alone.
3. Consider How You’d Like To Spend Your Retirement
Thinking carefully about how you would like to spend your retirement will ensure you can plan for it. You can use goals based financial planning to do this, and speaking to a professional if you’re serious about your retirement can be a big help. Would you like to spend your retirement in Hawaii, or do you want a nice little place in your hometown, not having to worry about bills and food too much? You’re going to want to be comfortable regardless, so don’t leave this too long to plan.
4. Figure Out What Truly Matters To You
Think about what truly matters to you. This is the only real way you will emotionally connect with your financial goals and work towards them. Do you want to make sure you don’t have to worry when you get older? Do you want to have plenty of money for your children? Figure out what’s within your reach, and go for this first. It’s also a good idea to have short term, mid term, and long term goals so that you have various things to aim for and can stay focused.
To make sure you’re on the right track, find accurate and compelling ways of tracking your progress. You could check in with yourself every few weeks and make adjustments if you need to. Thanks for reading!