What are your financial goals and priorities? Many people dream of debt free day, or just think about getting their budget balanced as soon as tomorrow. Others have goals of paying for their children’s college education and some just want to help their children avoid the same spending mistakes they did.
I often think about financial goals because knowing your goals and priorities is the foundation of every plan. Think about it. If you don’t have goals it’s difficult to determine spending decisions in your monthly budget. Is your immediate goal to pay off debt or save for emergencies? Without clearly establishing priorities you may not make the best spending or money management decisions towards achieving those most important goals.
CNNMoney.com provides Money 101 lessons and Lesson 1 discusses, you guessed it, setting financial priorities. Here are 10 things you should consider:
Setting Financial Goals and Priorities
Focus first on the goals that matter – You can’t work on every goal at once. Take the time to prioritize them and choose to work on the most important goals first. This is key so you don’t become overwhelmed.
Be prepared for conflicts - When goals conflict (you’re not sure which to tackle first), I personally recommend considering the priorities Dave Ramsey sets in his Baby Steps.
Put time on your side - If you’re consistent over time in your savings and investments they will grow. The same could be said with following your plan to get out of debt. The takeaway for me on this is to be patient. Follow your plan and believe you will succeed.
Choose carefully - Choose the goals that matter the most to becoming a better financial steward and building financial security for your family.
Include family members - Take the time to plan your goals with your spouse. My wife and I try to sit down and review our big goals at least once per year.
Start now - There is no better time than now to start managing your money wisely, setting goals and building plans to achieve them.
Sweat the big stuff - Keep your goals in focus and consider other options. For example, if a large vacation may take you off track from paying off debt. Look for a less expensive way to relax.
Don’t sweat the small stuff - It’s okay to have some spending allocated for fun as long as you take your goals into consideration as you make spending decisions.
Be prepared for change - Goals may shift as stages in life change. For example, we’ve learned there are plenty of expenses associated with having young children. As the children grow older the types of expenses change as well!
If you take away two things from this article, I would suggest setting the time to plan you goals with your spouse, if married, and start now. Schedule time this week to list your goals and prioritize them!
Can you think of other things to consider when setting your financial goals and priorities?