5 Tips to Achieve Your Financial Goals
5 Tips to Achieve Your Financial Goals
We all like the idea of better off financially, after all who wouldn’t want more money and less stress? How often do we actually take the steps to get there?
One of the biggest challenges we have is keeping ourselves motivated to accomplish what we need to change our current situation. Often this is due to the seemingly overwhelming challenge of getting out of debt, savings what we need for retirement, or simply having enough money to pay bills without taking out a loan to do so.
We came up with a few ideas to help you stay on track and accomplish your goals.
1. Set Specific Goals
As obvious as this sounds, it is often overlooked. Unfortunately, the goal of “more money” is too ambiguous and not tangible enough to keep us focused. However, “3mo Savings” or “Payoff Car in 12mo” are specific goals that you have a finite dollar amount to work towards.
Sit down and establish what is important to you financially. Once you have done so you can then set attainable goals for yourself to accomplish. This also works as a great reminder as to what you’re accomplishing since you can go back and check the progress for each goal.
2. Create a Budget
This goes along with number one, but is still a separate task. Once you have decided what you are striving to pay down – or save up for, you should have an idea of what kind of financial commitment that is going to take on a monthly level. From here we need to ensure that we not only have the means to accomplish that as well as have money for groceries, rent, diapers and so forth. This will also help you avoid unsecured loans or payday loans as you will have already had the money alloted to pay for those expenses.
What you don’t want to do is go about your goals too aggressively that it puts you in a pinch down the road. Make sure that you have a balanced budget and be conservative. You can also throw extra money at your goals when it comes around. Mint has a great free tool that allows you to not only set up budgets, but also set up goals and track your progress.
You can find some of our budget templates an other tools here:
3. Re-Evaluate Your Current Obligations
Chances are high, that you’re probably paying for something you don’t need, or are paying too much for something you do need. I was able to immediately save $60mo when I came to the realization that I’m paying for cable that I never watch. It may not seem like a lot, but when you look at it from an annual perspective – that’s $720 in a year. Something that could be put towards a credit card, payday loan, or your savings account so you have something to fall back on.
Don’t forget to look at the loans you’re currently paying on. Have a car loan, credit cards and other unsecured debt? Look into refinancing your auto at your local credit union to consolidate your high interest debt to pay it down faster at a lower rate. Need money in a pinch? Take a breath, and make sure you shop around. Avoid lenders charging 300-400% interest on that short term loan. In many cases it can end up costing you double what you borrowed. Instead shop around for alternatives such as an installment loan so that your not forced into paying the full amount plus interest back at your next payday. Ensure that you have fair credit and loan terms available when you need it – or at least that you know where to go.
4. Start Small
A complete financial overall is not going to happen over night. If you’re the typical American with credit cards and other loans, it may take 3-4 years to get out from under everything. That’s ok. It is important to remind yourself when things get stressful, that you have a plan and you simply need to stick to it to accomplish your goals.
5. Pay Yourself
Last but definitely not least, don’t forget to pay yourself. If you didn’t take into account your own savings in step 1 or 2, go back and review.
Life has or is going to throw challenges at us. Having something to fall back on so that you don’t have to take out another loan and go into more debt will help us overcome these as they arise. It will also help us stay on track with our financial targets. More importantly, the peace of mind that comes from knowing that you can handle whatever comes your way will do wonders for you.
The moral of the story is be knowledgable about where you stand. Putting a plan in place and knowing where your going are great ways to do that. Everyone, no matter what your income or budget, has the ability to improve their financial welbeing and accomplish their goals.
We hope you find the tips above helpful. We will continue to share education tips and tricks in the future, so be sure to like us on Facebook to stay updated.