No matter how old you are, or how much money you have in the bank, it is never too late to start setting new financial goals. A big part of successfully saving money and making more money is the formation of goals, keeping track of your progress and finding that motivation that is key to your financial success. Goal setting is a very important part of any financial plan, and if you are finding it difficult to put money aside, formulate new streams of income, or just get by, these goals can make a huge difference in your life.

The first step to take is to come up with a five, ten and fifteen year plan for yourself. Where would you like to be financially at each junction on the way? It is very important to be realistic here, and perhaps even undershoot it a little bit when you are first starting out. Setting attainable goals will help keep you motivated and on the right track. Once you’ve developed each of these three plans, you’re going to put the last two aside, and focus on the five year plan.

So, you’ve got five years to achieve these goals, now split that into one year a piece. Start small and work out how you plan to achieve those goals every single year. A five year plan looks a lot more attainable, once you’ve broken it down. Let’s illustrate this process a little bit.

Let’s assume that you want to have an extra $50k in the next five years. Broken down over five years, that means that you will need to find a way to either make or save $10k extra each year. That’s not quite as daunting as the big number, so let’s work with that first. You’ve got a goal of making an extra $10k this year, so how are you going to go about it.

Breaking that number down even further, we see that on a monthly basis, you need to either save or make an extra $834. This looks a little easier, and even if you’re on minimum wage, there is a way to start socking that much away. For those with more disposable incomes, saving that much money each month should not be difficult. Whether you plan to get a second job that will be used solely for reaching your goals, or you just put aside that much each month, you’ll be working towards your goals.

Now, you don’t want to let that money sit there, doing nothing for you. By placing that $10k a year in a high interest bearing savings account, you’ll be adding to it, which means you will have to work less to meet your goals. Even a small amount of interest will add up over the course of five years.

Once you have your five year plan down, it’s time to pick up the ten and fifteen year plans again and do the same thing with those. Break it down, make it easier to attain and watch your financial future come together.

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Originally posted 2008-09-15 05:10:14. Republished by Old Post Promoter

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Goal, Money, Personal Finance

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attainable goals, disposable incomes, financial goals, financial success, goal setting, how much money, little bit, minimum wage, motivation, next five years, saving money, streams of income, success goal