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Setting Financial Goals
The first step in personal financial planning is learning to
control your day-to-day financial affairs to enable you to do the
things that bring you satisfaction and enjoyment. This is achieved
by planning and following a budget.
The second step in personal financial planning, and the topic of
this section, is choosing and following a course toward achieving
your long-term financial goals.
As with anything else in life, without financial goals and
specific plans for meeting them, you will just drift along and
leave our future to chance. A wise man once said: "Most
people don't plan to fail; they just fail to plan."
The end result is the same and it is a failure to reach financial
independence.
The third step in personal financial planning is learning how to
build a financial safety net, which is like to having a retirement
fund for when you are no longer generating any income.
FOUR SIMPLE STEPS FOR SETTING FINANCIAL GOALS
Step 1:
Identify and write down your financial goals, whether they are
saving to send your kids to college or University, buying a new
car, saving for a down payment on a house, going on vacation,
paying off credit card debt, or planning for you and your
spouse’s retirement.
Step 2:
Break each financial goal down into several short-term (less than
1 year), medium-term (1 to 3 years) and long-term (5 years or
more) goals; which will make this process easier.
Step 3:
Educate yourself and do your research. Read Money magazine or a
book about investing, or surf the Internet's investment web sites.
Do not be afraid of the stock market.
Yes, there is a potential for loss, but if you do your research
and get a trustworthy broker, you can ensure your financial
future. Just remember not to put all of your eggs in one basket.
Diversify your portfolio. With a little effort you can learn
enough to make educated decisions that will increase your net
worth many times over. Then identify small, measurable steps you
can take to achieve these goals, and put this action plan to work.
Step 4:
Evaluate your progress as often as needed. Review your progress
monthly, quarterly, or at any other interval you feel comfortable
with, but at least semi-annually, to determine if your program is
working.
If you're not making a satisfactory amount of progress on a
particular goal, re-evaluate your approach and make changes as
necessary.
There are no hard and fast rules for implementing a financial
plan. The important thing is to at least do something as opposed
to nothing, and to start NOW.
Sometimes when people write down their goals, they discover that
some of the goals are too broad in meaning and nearly impossible
to reach, while others may seem smaller in scope and easier to
achieve.
It is okay to dare to dream about riches, but be realistic about
what you can actually do. A good idea is to break your goals down
into three separate categories of time.
One more thing to remember: by placing a time frame on your goals
you are motivating yourself to get started and helping to allow
you the chance to succeed. Just remember that you can adjust the
time frame whenever you want to.
Long-term goals (over 5 years) are those things that won't happen
overnight, no matter how hard you work to achieve them.
They make take a long time to accomplish (hence the reason they
are called long term goals), so give yourself a reasonable amount
of time, that are based on your best estimates of what it will
take to achieve them.
Examples of long-term goals might include college education for a
child, retirement plan or purchasing a home. Whatever the case,
these goals generally require longer commitments and often more
money in the end.
Intermediate-term goals (1-5 years) are the type of goals
that can't be executed overnight but might not take many years to
accomplish. Examples might include purchasing or replacing a
car, getting an education or certification, or paying off your
debts like credit cards etc. (depending on the amount).
Short-term goals (within one year) generally take one year
or less to achieve, based on the date the task is needed, the
total estimated cost, and the required savings.
What are your goals? To find out, you need to make up a list,
decide which timeline your goal fits into, detail the steps
necessary to achieve your goals, then take action toward reaching
those goals. It’s that simple.
You might be wondering where to start when deciding how to go
about to start your financial goals. These are some basic tips to
help you in making the best choices for you.
After looking at these tips, it is best for you to go out and do
some research to find the method(s) that suit you best.
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Begin by taking 5%-10% out of each pay
check and put it in a savings account.
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Look into different investment strategies such
as IRA’s, stocks, RRSP’s, mutual Funds, personal
investments etc. There are many more and all can assist you in
short and long term goals.
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Start making a budget for yourself that leaves
you with some extra money and follow it.
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Use your coupons that is why they are there.
It seems like small savings, but add together you could save
20-30 dollars at each trip to the market.
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Shop around for bargains.
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Do not live outside of your means.
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Work with a credit counselor to get help in
lowering your monthly expenses and get rid of your debt.
These are just some of the things that you can do
when beginning to realize your financial goals. Of course, you
also have to follow the steps in the above sections on how to
successfully set goals.
The steps to setting goals successfully don’t change, only the
methods that you use to go about it. By that I mean; when it is
career wise, work to get noticed; for relationships, work on
maintaining your intimacy or getting it back; in financial
matters, work to save and invest money etc. It really is that
easy.
To your Success, may you reach your goals.
Gary
Killops
Using the Plug-In
Profit Site System has help Gary Killops achieve his financial
income goals by creating multiple streams of residual income.
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