Tag: How To Set Financial Goals

How To Set Financial Goals: 10 Simple Steps!

How To Set Financial Goals: 10 Simple Steps!

What Are Financial Goals?

Financial goals are the big visions you have for your personal finances and the way you plan to spend your money.

These financial goals are what help us achieve ultimate success and financial freedom. They also make our dreams easy to identify.

Why Do Financial Goals Matter?

Financial goals push us to keep moving forward in our day-to-day lives with a relentless focus on reaching life changing goals.

They’re what will determine how comfortably we live our lives when we’re ready to retire.

Financial goals are what separate the lower, middle, and high class.

*Key Takeaways*

  • You’ll learn the importance of becoming debt free
  • How to adopt winner habits in order to secure your financial future
  • Ways to diversify your income

If you’re here it’s because you have a genuine curiosity on how to succeed financially in life. The great news is that what led you here is no coincidence. I strongly believe we attract into our lives what we think about. Navigate this platform and manifest.

Here are 10 ways you can begin setting financial goals for yourself in order to eliminate any financial insecurities you might have.

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#1. Paying Off Debt

Financial goal to Pay off debt
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Paying off debt is a financial goal everyone should strive for. Accomplishing this goal is your ticket to becoming financially free.

Everyone wants to be debt free but not everyone is willing to put in the work to break from the shackles of debt.

Some benefits to paying off debt include:

  • Freeing up resources to save and invest
  • Eliminating monthly payments to lenders
  • No more interest
  • Surge in credit score points

Paying off your debt will require temporary sacrifices, such as living below your means and delaying gratification.

I’ve found that the snowball effect is very efficient when it comes down to paying off debt. You essentially start from the smallest debt and work towards the biggest debt. You can read more about it below.

If you find yourself straying from paying off your debt, remember why you started in the first place. Crush this financial goal so you can focus on all the wonderful things in life that truly matter!

Read: Debt Sucks | Here’s How To Pay Off Thousands In Debt

#2. Creating an Emergency Fund

Financial Goal to Create an emergency fund
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There are two types of emergency funds. One is a temporary emergency fund consisting of at least $1,000.00.

The second type of emergency fund is a hefty nest worth 3-6 months of expenses in case of unforeseen circumstances that may occur (and they will).

This financial goal provides you with security for when s*** hits the fan and allows you to act without the stresses caused by the lack money.

Here are some real life instances where an emergency fund can become a helpful tool:

  • To cover the cost of an unexpected medical expense
  • Keep you afloat during a recession
  • Means as a cushion to fall on if you become unemployed
  • Capital if your business loses revenue

A great way to begin your financial journey is to create a temporary emergency fund so you can focus on paying off your debt first.

Once you’ve paid off your debt, start working towards building your hefty nest worth 3-6 months of living expenses.

Read: How To Create an Emergency Fund and Why It’s Important

#.3 Saving Up For A Home

Saving up for a home is a great financial goal to crush. If you dream of owning your own home some day, you’ll need to save up for the down payment along with the fees that make this possible.

While taking up a home loan is considered a liability, it becomes an asset once you’ve paid it off.

A few of the benefits to owning a home include:

  • Security and stability
  • The ability to cash out equity on your home
  • The privilege to selling your home and earning money on increased value
  • The option to renting your property resulting in passive income

Read: 10 Successful Ways To Save Money During A Recession

#4. Increasing Your Credit Score

Financial goal to Increase your credit score
Franknez.com
Increase your credit score – Franknez.com

Your credit score demonstrates how responsible you are handling other peoples money.

Lenders tend to accept credit scores over 650 and even 600 in some cases. The thing about our readers though is that they don’t settle for average. You are anything but average.

One of your financial goals should be to reach an excellent credit score of 700 and above.

An excellent credit score will provide you with access to just about any type of loan whether it be a home, car note, or business loan.

Read: How To Increase Your Credit Score | Reach Excellent

#5. Making Your First Investment In The Stock Market

Wall Street Bull - financial goal to invest in stocks
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This financial goal is probably the most intimidating goal of them all. You most likely have thought about investing in the stock market but perhaps don’t know where to start.

We walk our readers on how to invest in the stock market step by step here.

The stock market might not be everyone’s choice of investment, but for those of you who want to partake will see just how easy it is to purchase shares and see your money grow.

Before you begin to invest in the stock market, be sure you:

  • Are debt free in order to maximize your deposits in the market
  • Have created a strong and healthy emergency fund
  • Acquire the confidence to proceed with investing in the market

Investing in stocks has the the biggest potential if you’re striving to build wealth. With the S&P 500 yielding an average 7% in return, it’s highly unlikely you’ll ever see this percentage from any bank or institution.

Are There Other Alternatives To Investing?

Invest for your financial goal

A very good alternative would be to put your money in a high yielding or money market account.

While your regular banks pay you 0.01% APY, high yielding banks can pay up to 2.05% APY!

Rates fluctuate from time to time depending on the economy, but it’s a great money move; especially if your financial goal is to grow your savings account.

Here’s a list of high yielding banks you can check out so your money can earn you a little bit of interest (money while you sleep):

*Rates are subject to change

These three banks are all FDIC insured meaning you are protects up to six figures (you’ll have to read the fine print for the exact amount).

While the rates aren’t amazing per say, they have been higher in the past and will continue to fluctuate.

BMO Harris is the only bank that requires a minimum of $5,000 to qualify for their interest rate. Marcus & Ally don’t require a minimum deposit to qualify.

Read: 5 Ways to Earn Leveraged Income: Start Now

#6. Growing Capital to Build A Startup

financial goal to build capital

Perhaps you’ve been wanting to start your own company or start a new business venture.

Growing capital is a great financial goal to set that will help you start up your company. Use these resources to purchase equipment, hire a team, and build your business.

(A) Set a specific goal.

The amount of money you’ll need to raise will highly depend on the type of business you’re going to be creating.

(B) Find your niche.

Find out which industry best suits you according to your skills and knowledge.

Read: How To Advertise Your New Business For Organic Growth

#7. Preparing For Retirement

Yahoo Finance reported from a 2019 survey that 64% of Americans will retire broke.

I think it’s safe to make retirement a priority when it comes to setting financial goals.

Retirement should be the time where we can finally look back and feel like all the hard work has paid off. It should be that time period where you can sigh in relief knowing you won’t ever have money troubles.

Around this time you’re most likely earning passive income from a variety of sources. Perhaps your investments are paying tremendous amounts of dollars every month or your online business keeps generating income.

Money during this time is working for you and you can enjoy anything your cashflow is able to provide.

How Can I Prepare For Retirement?

Preparing for retirement really includes a lot of the things that we’ve covered over in this post. Such things include:

  • Start a 401(k) with an employer match if available
  • Save money using a high yielding or money market account that accrues interest
  • Free yourself from debt in order to maximize your savings
  • Invest in the stock market
  • Invest in real estate
  • Increase your income

Preparing for retirement will become more of a challenge if you’re not debt free. The earlier you begin to save for retirement, the longer you have for compound interest to put your money to work.

Read: How To Stop Living Paycheck to Paycheck

#8. Developing a High Income Skill

financial goal: High income skill
Franknez.com

People hit their income peak around the ages of 40-50. Developing a high income skill, especially if you’re younger, should be a financial goal you should be meeting every year.

By increasing your income every year, you’re able to come up with resources to pay off debt, invest, save, and so much more.

How Can I Develop a High Income Skill?

Develop a high income skill by providing tons of value in your industry and workplace.

The effects of providing value in the workplace result in a promotion or raise, or can be driven by an increase in sales figures.

Read: These Are The BEST Strategies To Increase Your Sales

If you’re nowhere near the income peak age you should be focusing on making as much money as possible early on in order to free up your resources so you can start focusing on the things that really matter.

Remember, you cannot grow wealth being in debt.

#9. College Savings

financial aid college savings

A financial goal that’s popular amongst parents is saving for their children’s college tuition.

A college savings plan will come in handy when your children are ready to take that leap in the real world.

Saving now can help you get a great start. We suggest using a savings account that will accrue interest; this way you earn additional money on top of your principle and recurring deposits. Use compound interest to boost your savings goals!

According to the Wall Street Journal, the average tuition is a whopping $37,172!

It would be wise to start saving for this goal as soon as you can. Personally, we’d opt out for teaching our kids to become entrepreneurs instead so they can earn as much money as they desire. It’s the financially responsible thing to do, but hey! We need all type of professionals in this world.

#10. Financial Education

Financial Education
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What better financial goal than to further your financial education!

If you’re not 100% certain about how something works, invest time in yourself and do the homework until you’re confident about such topic(s).

People used to read about everything, now you can watch videos or read blogs like this one for more information.

It took me about 3 months of studying and researching how to invest in the stock market before committing to purchasing my first shares of stocks.

I created my Vanguard account and although I had done some research, it took a while before I actually proceeded. Financial education allowed me to grow confident in all things I do financially.

I wanted to make the process of investing in stocks easier for my readers so I wrote on how to invest in the stock market (step by step). You can read it here.

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Become Financially Confident

Dear readers, I encourage you to step outside your comfort zone and educate yourself as much as possible so you may become financially confident and financially independent.

Break the cycles and begin to develop winner habits to secure your financial future.

Let us know in the comments section below which financial goal(s) you’ve taken up! Our readers would love to hear what you’re working on.

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eBook: Reaching The $10K Mark: How Perseverance Overrides Adversity

5 Habits You Need to Crush Your Money Goals

5 Habits You Need to Crush Your Money Goals
5 Habits You Need to Crush Your Money Goals

If you’re thinking of setting financial goals for yourself you’ll need to develop these 5 habits to crush your money goals first. Let us know in the comments section below if you’re on track.

#1. Learning to Budget

Crush your money goals by setting a budget
Crush your money goals by learning to budget

Budgeting is a great habit that will play an important role on your money goals. Learning to budget allows you to know exactly how your money is being used.

Download the mint app to keep tracking of your monthly expenses and keep track of your net worth.

This crucial habit prepares you for the discipline required to meet your financial goals. It will teach you to stay focused on your numbers and to stick to your goal.

#2. Being on Time

Your money goals will require you to be on time.

Being on time demonstrates responsibility and can show people you’re dependable.

Your money goals will require you to be trustworthy. Here are some examples being on time influences your habits:

  • Being on time for work (dependability & promotion opportunities)
  • Paying bills on time (increases your credit score | shows lenders you’re responsible)
  • Meeting deadlines (allows you to retain clients & enables more business opportunities)

Being on time is a great habit you can develop in order to crush your money goals because of how diverse this action influences your world.

Financial success will require you to pay your bills on time in order to increase your credit score.

By increasing your credit score, you’ll be able to easily qualify for a home, car loan, or anything of significant meaning to your money goals.

Read: How To Increase Your Credit Score | Reach Excellent

#3. Understanding Needs VS Wants

Understanding Needs VS Wants

If you want to crush your money goals you’ll need to be able to identify the difference between needs and wants.

This habit will allow you to make smart purchases.

Needs Are:

  • Food expenses
  • Utilities
  • Affordable rent
  • Proper clothing
  • Tools for work
  • Means of transportation

Wants Are:

  • The latest iPhone and tech
  • Fancy and unnecessary clothing
  • The new car
  • Dining out and entertainment
  • Vacations

When you are setting money goals for yourself and your family, you learn to identify priorities.

Priorities are the important things that come first. Anything beyond that is a luxury.

Read: 10 Successful Ways To Save Money During a Recession

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#4. Avoiding Income Creep Lifestyle

People who lack the will to spend less as they earn more experience what is known as income creep lifestyle.

Avoid Income Creep Lifestyle

If you move into a bigger home or decide to finance your dream car as soon as you receive a promotion then you are experiencing income creep lifestyle.

Avoiding income creep lifestyle means you’ll have to be patient and develop a habit to delay gratification.

You cannot reach your money goals if you are spending more money as you earn more. This cycle will keep you in a repetitive loop leaving you with little to no funds to save, invest, or pay off debt.

Here are some great habits you can develop if you earn a raise in income:

  • Keep your expenses the same
  • Use the additional income towards your money goals
  • Delay gratification and stay the course

By keeping your expenses the same you’ll be able to allocate your additional earnings towards your money goals. You can use this extra money to pay off debt, save for a home, or to pay off high interest debt!

Read: 7 Easy Ways Millennials Can Start Earning More Money

#5. Always Aiming to Increase Your Income

Increase Your Income To Crush Your Money Goals
Crush your money goals by increasing your income

When you’re looking to crush your money goals you’ll come to the understanding that it will require sacrifice to meet such goals.

You understand that increasing your income will allow breathing room to not only enjoy your money but to also meet your financial goals quicker.

Aiming to increase your income is a great habit that will help you reach your goals without a doubt as long as you avoid income creep lifestyle.

By delaying gratification, you’re setting yourself up for financial success.

Read: How To Set Financial Goals: 10 Simple Steps!

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