Every one of us have their own financial goals. Whether it is to buy their first car, first home, travel abroad, or to retire early.
Thinking of planning and organizing your finances? Here are the different short-term and long-term financial goals that you should follow.
Short-term goals
- Building an emergency fund
Funding an emergency fund is one of the essential things you should do to establish your finances. As soon as you get your first paycheck, set aside amount for your emergency fund. You can start by allotting 10% to 15% of your income. Then, you can eventually add amount in case you get a salary raise.
Remember that the ideal emergency fund contains at least three to six months’ worth of monthly expenses. Furthermore, open a separate account for your emergency fund so that you can avoid spending it.
- Paying credit card debt
Paying off debt requires consistent and persistent effort. So, it is essential that you follow a specific debt repayment plan. You can try the snowball method or opt for debt consolidation. Select the repayment method that suits your preference.
Make a payment calendar. Note every due date that you have. Doing so will enable you see which debt to pay and with which paycheck.
- Travel fund
One of the financial goals of many, especially of the millennials is to fund their travels. You can try doing different money challenges to start your travel fund, so that it does not compromise your monthly budget. One of the popular one is the 52-week challenge. You just have to choose what increment you will follow.
Long-term goals
- Funding retirement
One of the essential long-term financial goals that you must have is funding your retirement. It may be sound too early, especially if you are in your 20s. In fact, the sooner you start your retirement plan, the more you will have in your golden years.
During your 20s, you must have a concrete plan for your retirement. Before you identify how much you should save for it, determine your retirement goals first. How do you want to retire? Do you want to live in the city or you want to settle down in the province? Answering these questions will help you get started with your retirement plan.
When you already answer these questions, you can start saving up for your retirement.
- Saving for home down payment
During your 20s is the best time to save up for your house down payment. Since it is a long-term financial goal, you can start saving up at least 5% to 10% of your income, which depends on your budget.
- Starting a business
It is also recommended to start saving up for your dream business. However, in case that your savings are not enough for the your venture, you can opt to loan money. Look for a lender with low-interest rate, click here for more options: https://www.ecomparemo.com.
Key takeaway
Mentioned in this article are only few of the many financial goals that you must follow. The timeline for these goals may vary, depending on your need. Having a specific financial goal can enable you to achieve financial stability.
