Now is the time of year when people step back and consider where they stand and how close they are to achieving long-held goals. No matter what your objectives, a sound financial plan will put you in a better position to achieve them, according to the Pennsylvania Institute of Certified Public Accountants.
Make a list
When you write down your dreams on paper, you’re one step closer to making them a reality. In addition to short-term goals, such as purchasing a car or starting a savings plan, don’t be afraid to include more ambitious ideas, such as a new home purchase. Once you’ve made your list, try to construct a realistic timeline for achieving each one. While there may be set dates when you’ll need college tuition money or retirement savings, other goals, such as the purchase of a new home, may not have clear deadlines. If, for example, you give careful consideration to whether it might be realistic for you to take on a mortgage in five years, it’s easier to create a budget that will help you make that dream come true.
Plan to save
If you don’t already have a monthly budget, now’s the time to determine how much money you spend each month, how much is required to cover the necessities, and what’s left over. Then decide what you can save every month toward your goals. If the amount you need to meet your objectives is too high, reconsider your timeline or your goals. You’re more likely to think your goals are impossible to reach, and potentially give up, if your savings plan isn’t realistic.