While every financial situation is different, we all should be making goals for financial planning. With this guide, discover three ways to incorporate financial goals into your budgeting and planning.
What Is a Financial Goal?
A financial goal is the end goal you’re trying to reach with your money management. Accomplishing a financial goal may involve saving, spending, or investing.
Why Are Financial Goals Important?
It’s important to name financial goals in your budgeting and planning because it gives you direction with your budgeting. Many people hope to retire at a certain age, but without setting practical measures to get there, it can become a more stressful or unattainable dream. These goals should always be measurable, specific, and time oriented. Generally, financial goals are grouped into three categories: short-term, medium-term, and long-term goals.
Short-Term Financial Goals
Short-term goals are those that can be accomplished within a year. These goals help us achieve everyday aspirations in steps. While they may be accomplished without planning, setting these goals gives us a sense of accomplishment and intentionality. Especially for early career financial planning, short-term goal setting prevents overspending and instills smart money habits that are useful to accomplish medium- and long-term goals. Setting financial goals is an important step in developing financial literacy, which is crucial to long-term financial success. Short-term financial goal examples include:
- Creating a budget
- Paying for a vacation
- Establish an emergency fund
- Maxing out retirement contributions
Medium-Term Financial Goals
As expected, medium-term goals are supposed to take a little bit longer, typically around five years. These goals are achievable but require more intentional spending and saving. Medium-term financial goal examples include:
- Earning a goal total income
- Paying off all or a specific type of debt
- Buying a home or saving for a down payment
Long-Term Financial Goals
Unlike the previous two categories, these can range widely in the length of time they take to complete. The general definition is anything that will take longer than five years to achieve, but some long-term financial goals may follow you for decades. Though the common long-term goal is retirement, there may be many things you hope to achieve that will fall into this category. It’s helpful first to choose long-term goals, then see how your medium-term and short-term goals can align and help you in that process. Long-term financial goal examples include:
- Living debt-free
- Fund a child’s education partially or fully
- Make a million dollars
- Travel the world
How Do I Achieve My Financial Goals?
Achieving your financial goals can seem daunting but can always be broken down into clear, achievable steps. For example, by using our debt consolidation calculator, you can discover how to conquer your debt monthly. With careful planning, you shorten the amount of time it takes to achieve a particular goal.
It also helps to understand what resources are available to you. If you plan to buy a home, research the home loans available to you. Then use our home loan rate calculator to discover how various loans can help you work toward your financial goals.
Work Toward Your Success With Landmark National Bank
With our expert staff, many resources, and personalized banking solutions, Landmark National Bank will help you achieve all your financial goals. Learn more about our services and visit a Landmark National Bank location near you today!The content