What is a Financial Goal?
We’re taking a pretty broad definition of financial goal—it’s expenditure that you can’t just make on a whim, but requires planning and saving. This means that there’s no specific dollar amount, because the type of purchase that requires planning for some would be just a swipe of the credit card for others. We tend to think any purchase over $500 merits some thought, even if you have five times that much in your checking account at any given moment.
Financial goals can be fun, like a family trip to Europe. Or they can be less sexy, like paying off your student loans. They can also be financial tasks like adding up your net worth, or automating your retirement contributions.
The idea is to write down your goals, figure out how much the total cost is, set a deadline for when you’re like to accomplish the goal and then figure out how much you’ll have to put away (or pay down, if you’re paying off debt) to meet the goal.
Here are some examples:
Pay off student loans
Price tag: $67,288
Deadline: 5 years from now (60 months)
Monthly payment: $1,121
Buy a fancy cargo bike
Price tag: $1,600
Deadline: 12 months from now
Amount to save monthly: $134
Here are some other examples of things that might be on your financial bucket list:
Note – some financial goals are not savings oriented but focus on getting financially organized such as:
Everyone’s financial goals are different, so this list will look different for everyone. Writing down your financial goals and figuring out exactly how much it will cost to reach them is the first step to making sure you’re using your money to reach your goals.