We all have financial goals that we would like to meet, but many of us do not have a plan for reaching these goals. The goals will remain in the back of our heads like unachievable dreams unless we actively take the steps needed to make these dreams a reality. Making a plan to achieve your financial goals is much easier than you would think. Here are some easy techniques that you can use to help you achieve your financial goals.
Have Tangible Goals
The key to achieving your financial goals is having tangible goals to aim for. If you say, “I am going to buy a house someday,” the goal is so vague that it will be hard to work towards in any meaningful manner. However, if your goal is to save enough money to put a 20% down payment on a $100,000 house in five years, you have both an amount and a time frame to work with while pursuing your goal. The more specific you can be, the easier it will be to make a concrete plan for achieving your financial goals.
Plan Using Accurate Costs And Expenses
To make a plan for completing your financial goals, you must first figure out where your money is going and why you are spending what you are spending. For example, what does love really cost us? The costs of dinners, movie tickets, new clothes, and the additional gasoline needed to travel to your dates can be surprisingly expensive if you take the time to add it all up. If your relationship makes it to the next level, you will also be considering the costs of getting married, buying a home, and having a child. To have the money that you need for the things that you would like to do during your life, you will need to know how much it is going to cost you so you can plan your income, expenses and savings accordingly.
Automate Your Plan
If you really want to succeed at your financial goals, try to automate as much of your plan as you can. Automating your plan locks you into a plan that moves you toward your goal without having to make active decisions along the way. One of the greatest financial innovations of recent years is online banking, which allows you to take many actions with your bank account quickly from the comfort of your own home. You can use the programs provided by your bank to streamline the tasks that are needed to reach your goal, like scheduling a biweekly payment to be made to your credit card company to pay off debt or creating automatic transfers from your checking account to your savings account.
Photo courtesy of Ken Ratcliff