set financial goals
Getting all your finances in order requires a bit of give and take when it comes to deciding what you have to give up to achieve something else. If all our dreams came true, we could buy what we want when we want, but we don’t live in our ideal world, so we have to decide what our priorities are.
In today’s world, where setting foot on the property ladder is unattainable for many young people in their current circumstances, they need to find another strategy. These same rules apply regardless of circumstances and it is important to get into the habit of saving and investing money. If you are a New Zealander, I cannot stress enough how important it is to join the New Zealand kiwisaver retirement plan. With incentives like free money from the government and contributions from employers, this is a piece of cake. Plus, you’ll be able to use part of your kiwisaver for a deposit on your first home as long as you’ve had a kiwisaver for five years.
If you are from another country, your retirement plan will have different rules and plans.
A multitude of factors will determine your financial goals, but the main ones are:
YOUR AGE
If you are young then you have the luxury of time on your side and make time work for you. As the saying goes, “It is timing and not timing that is the key to making money in the markets.”
YOUR FINANCIAL SITUATION
If you are in debt, getting out of debt should be your number one priority, especially if it is consumer debt. That’s a debt on things you don’t need, like a TV, a living room, videos, and other appliances. “If you don’t have the money to buy those items, don’t buy them” is a good philosophy.
Money spent on non-essential luxury items may be better spent building your wealth.
YOUR MARITAL STATUS
This goes without saying, but your marital status is a big factor in determining what your life goals will be because life isn’t just about you because there’s someone else in the picture; this means they both have to be on the same page.
So how can I achieve my goals with x amount of money in my payment package?
1 Increase your income
2 Reduce spending
3 Sell things you no longer need
INVEST YOUR MONEY
Invest your money, don’t waste it like most people. An increase must be invested in your wages and salaries, unless of course you live paycheck to paycheck. Set long-, medium-, and short-term savings goals, depending on what you’re saving for.
The time frame for when you need the money is a factor in determining where you will invest the money. You certainly wouldn’t invest in high-risk, high-return growth stocks if you needed the money in the short term.
set financial goals
