Top 5 Steps to Reach Your Financial Goals in 2017
The start of a new year is a great time to begin finding ways you can meet your financial goals. Whether you want to put a deposit down for your first home or an investment property or become debt free, we all have our individual financial dreams.
Turning those dreams into financial goals requires planning and budgeting. This involves taking a large and potentially vague goal into something that can be achieved within a specific timeframe. It’s not an easy thing to do, but there are five steps that will drastically help your chances, regardless of what your financial goals are.
- Create a Detailed and Flexible Plan
You should ask yourself exactly what you need to do to reach your goals. What is the timeframe? What do you have to achieve each month? Each week? Your plan needs to be SMART (Specific, Measurable, Achievable, Realistic and Time specific).
Your plan should set out clear objectives over varying timeframes relating to different things. Major and minor life changes can upend a financial goal. Many people find sticking to a budget challenging and can give up after the first blowout. But with both budgeting and planning for financial goals, you shouldn’t allow it to fall apart if you struggle to meet one step or phase of it.
Instead, you should add some flexibility to account for unexpected circumstances. This can come in the form of contingency, where you account for a loss of income for unplanned expenditure while still being able to reach your goal.
- Set Small Milestones
Focusing on shorter timeframes is a highly effective way of reach a financial goal. Again, it comes down to being realistic and including detail. Let’s say your goal is to save $10,000 for a home deposit. Rather than focusing on that overall goal, break it down into smaller milestones. Focus on saving $1,000 in a month, or $200 in a week.
By breaking your goal down into smaller pieces, the day to day actions you need to take become clearer and the overall goal seems more achievable. It’s much easier to figure out how to save for a weekly period than it is for a longer time frame.
- Automate Savings
Once you’ve broken down your goal into small milestones, automate the process. Set up an automatic transfer into your savings account. This allows you to lock in a plan that moves you towards your financial goal without having to make as many conscious decisions.
Automated transfers put you in a position where you focus on managing money after your goals are met rather than having to make room for it. This can be helpful during times like Christmas which can commonly result in overspending.
- Keep Savings Out of Easy Reach
Once the automated savings process is underway, make it difficult to immediately access that money. It can be tempting to tap into it to splurge but impulsive decisions will only undermine your goal. For example, there are many savings accounts available that don’t allow you access through an ATM card.
To avoid the possibility of tapping into these savings all together, have a separate account entirely for emergency funds as part of your contingency plan. Having these dedicated accounts will help you control your spending habits if it’s an issue.
- Get Advice
Leveraging expert advice and services can be a great help. Financially successful people tend to surround themselves with the right support to achieve their goals. Personal finance is no different.
You may decide investing is an ideal way to reach your financial goal, which will require you to enlist the services of a good fund manager. You might also get a good accountant to help you minimise your taxes and help you make the most of the deductions and tax breaks you’re eligible for.
If buying a home is one of your financial goals, enlisting the help of a professional mortgage broker will help you get the best possible home loan and give you advice about the home loan process and costs involved.
Multi Choice Home Loans in Queensland can help you achieve your property goals. We have offices in Brisbane, the Sunshine Coast, Beenleigh and Hervey Bay. For quality advice and services, call one of our friendly local brokers on 1300 36 36 99 or get in touch online.