A person’s life can be greatly impacted by the financial goals they establish for themselves. If you are happy with just getting by, likely that will be all you ever accomplish. Setting stretch financial goals in four areas is the key to improving your financial well-being.
What are the four key areas for setting goals?
What are the important savings and investment goals to establish?
- Savings and investments
- Debt or Lending related
- Planning and knowledge
- Financial habits
What are the debt and lending related goals to establish?
- Be contributing at least 10% of your income to retirement
- Save for big expenses like vacations
- Start investing outside of retirement plan
How should we incorporate planning and knowledge goals?
- Have a credit score of 750 or higher
- Don’t carry a balance on credit cards
- Keep loan payments to less than 35% of net monthly income
Are there financial habits we should be all strive to achieve?
- Have established long term financial goals
- Have all the insurance that you need (renter, homeowner, life, auto disability)
- Be preparing for major life events that are on the horizon
- Track your net worth
- Use a budget to make decisions
- Comparison shop on everything
These types of goals can help you start on the path to being more financially secure and provide a framework to move beyond just getting by financially.