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Setting Your Goals

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Contributor:
Sorted.org.nz
Sorted.org.nz

Goal setting is an attitude to life. It puts you in charge.

As you go through the process of getting financially fit, you'll
find that goals pop up everywhere. Big, long term goals are where you
want to end up. Smaller, short term goals are the steps that help you
get there.

If your big goal is to run a marathon next year, you'll need a
training plan with a number of smaller goals to help you through your
training. Your first goal might be just making it round the block on
your first training run.

Getting financially fit is no different. You might have a big goal
to own your own house in the next five years. To get there you'll need
a plan that includes a series of smaller goals - maybe you'll need to
save money for a deposit or pay off a student loan as the first step.

Don't worry if you find it hard to set long term financial goals for 30 years from now. Set your horizons closer.

Some horizons should be close

If you're young you won't find it easy to set savings goals for 30,
40 or more years off. Set your horizons closer - make a plan to save,
say, $5,000 in the next five years. You could allocate half that to
travel, and the other half to an as yet unnamed long-term project. In
five years you might for instance, want to start a business, do some
study, or buy a house. All of these will get you into the savings
habit, and should lead eventually to you saying - "that was a good
decision."

Take some quiet time, when you are not under pressure, to set your goals.

Be specific, realistic and write each thing down. You might, for instance, set goals like:

  • Saving $20 a week
  • Paying off your credit card debt in six months
  • Saving for a new car
  • Paying off your mortgage in 15 years instead of 25
  • Increasing your income by $5,000 in the next year
  • Saving $4,000 for an overseas trip next year
  • Maintaining a retirement income equal to 70% of your pre-retirement income.

Use the My Goals worksheet on Sorted.org.nz to write your goals. You can then save them to Sorted's My Plan with your calculations.

Keep your goals within reach

Make your goals easy to remember. Ideally, the whole thing should be simple enough to carry around in your head.

 

Content provided by Sorted.org.nz, Your Independent Money Guide.

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