If you haven’t done this already, you need to set personal finance goals towards financial security. Without having these goals, you are putting yourself in risk and set yourself up for failure. At the very least, you need to think about where you see yourself in a couple of years. What sort of life do you want to lead?
Planning and goal setting, reduces the risk of spending frivolously and wasting money now. These things tend to always lead to financial hardships in periods of unexpected expenses i.e. hospital bills or retirement. Thus being financially secure, requires you to set financial goals, reevaluating and updating those goals often.
Here are 10 examples of achievable personal finance goals you can set for this year to improve your financial position.
1. Build An Emergency Fund
If you already have an emergency fund, consider doubling it this year. You can never have too much money in your emergency fund as no one really knows what the future holds for us.
To establish an emergency fund, know what your expenses are and how much it would cost to maintain your current lifestyle if you lost your income for a period of about 6 months. It is pertinent that you prepare for the unexpected as though it is imminent. At the end of the day, it is always much better to be ready for anything than to panic because you can’t meet your expenses.
2.Get out of Debt
Make this goal and stay out completely. Getting out of debt will allow you to have full control of your life and finances. It will make it easier for you anything you set out to do without worrying about the debt you need to service. No de
bt simply means, more to spend, save and invest. There is nothing better than not having debt hovering over you – hindering your freedom. With debt, you can’t easily quit your job or live life worry-free.
3. Live beneath your Means
The oldest rule in the book and it is always worth repeating. By learning to live within your means i.e. on less than you earn – you will always have more than enough income to save, invest and eliminate debt. Additionally, while you live beneath your means, always seek to increase your income simultaneously. This way, you will always have money to set aside to achieve financial goals while you improve your life as well.
4. Save & Invest to Generate Passive Income
A great goal for is to try and generate enough passive income (through your savings and investments) to cover all your living expenses. Passive income is basically, establishing enough assets to earn you an income. Great passive income investments are: rental properties, high yield savings accounts, CD ladders, dividend stocks and more.
5. Early Retirement
Early retirement is one of those top-rated financial goals that everyone dreams about and wants to achieve. If you are determined enough to retire by the age of 45, for instance, there is nothing wrong in trying. Planning for retirement, in general, is great for many reasons:
- Achieveing retirement goals might take a long time, hence its good to start as soon as possible
- Poor health can force you into early retirement
- Family circumstances in which more and more of your time is needed can force you into early retirement
- A few years from now you may want to slow down, having a substantial retirement saving can enable you to retire early
- It is always better to have the option to retire early on the table – don’t you think?
6. Set up Multiple Income Streams
Creating multiple income streams is always a wise thing to do and serves as a form of income insurance in the event you lose your primary income. For this reason, it needs to be a priority in your financial goals as it can afford you the luxury of options i.e. you can easily semi-retire at an early age, quit your job, pay off debts, expands your investment portfolio and more.
7. Insurance for Contingencies
A lot of people do not take insurance seriously and therefore, do not get covered enough. Therefore, this year make it a priority to work with a good insurance agent to help you get just enough insurance cover. If you see fit, make sure you get your life, health, house and car, covered.
8. Deal With Any Addiction
Addition can be a serious obstacle to achieving financial goals. Thus, making it a priority to overcome any addition will help you restructure a good amount of your income to service your financial goals instead of satisfying addiction needs.
9. Read A Book
This year choose to be a continuous learner by reading a book every month. Reading will help you expand your knowledge and challenge you to be a bigger and better version of yourself. Perhaps, you can start with this list here.
10. Write A Will
Are your wishes known? If not ensure they are. However you choose to live your life, it should be a goal to make sure that your loved ones are left at the very least a little better off as a result of your life. This means making the necessary plans for your dependents to be taken care of – don’t leave a mess behind.
Make it happen!
Financial independence has nothing to do with luck or magic, it is simply achieving financial goals one at a time. This coming year, define your own version of financial independence and stive to achieve it – one goal at a time.
Thanks Guys for 2019…
A Happy Holiday and A Happy New Year to You All!
What are some of the financial goals you will be having this year? Feel free to share them with us by leaving a comment below.
Image credits: Top by Karolina Grabowska via Pexels
See also:
- How to Save Smart With A Certificate of Deposit Ladder
- With The NSE Drop, Is Now A Good Time To Invest?
- How to Invest Your Savings for Short-Term Goals
- Buy!! The Financial Planner Excel Template
- How to Invest Your Money For Intermediate-Term Goals
- Buy!! The Financial Planning Workbook
- How to Set Effective Financial Goals You Can Actually Achieve