Are your finances so overwhelming that you don’t even know where to begin? Should you focus on your debts or building your savings account? Let’s start with the basics and consider these seven financial goals.
Make a List
Ironically, this financial goals list starts off with making a list! Write down or create a document on your computer listing all of your financial concerns. Some big ones to consider are:
- Checking and savings accounts
- Debts: Mortgages, students loans, credit cards, etc.
- Retirement accounts: 401k, Roth IRA, pension, etc.
- Investments
Include the amounts that you have in these accounts or that you owe. That way you can begin making your plan.
Create a Budget
In these modern times, the notion of a personal or household budget may seem quaint, yet it is still a vitally important tool. Why? A monthly budget will lay out both your expenses and your income. Over time, you can track your spending and earnings, as well as make changes to your habits that will allow you to reach your financial goals. There are plenty of tools available online to help you create a budget as well as track expenses and income — broken down into neat graphs as well.
Start Saving
Sadly, many Americans do not have enough money to cover an unexpected minor expense let alone a major financial emergency. These can snowball into much larger problems that can be devastating to you financially. So, the easiest way to solve this problem is to start saving, even if it’s just a few dollars a week. Put the money in an account that doesn’t get touched unless it is an emergency.
Contribute to Your 401k
If you have a 401k at work but have not been contributing to it, or not contributing the full amount, it’s time to up the ante. Saving up to the full match by your company is important for your financial future. Just as with savings, many Americans do not have enough money socked away for retirement. They also underestimate how much they will actually need to retire on. If this sounds like you, search online for calculators that can help you solve this problem.
Get a Handle on Your Debts
Along with your savings and retirement it is important to pay down your debts. Young people are starting out their careers with student loans that can take a long time to repay. Check with your lender to see what your options are for paying off your loans. Another debt issue is credit card debt which can be a very difficult hole to get out of. Avoid carrying a revolving balance and pay it off when the bill is due. If you are in credit card debt check with your cardholder for repayment options as well.
Establish What Happens to Your Assets
Often what is overlooked is what happens to your assets when you pass on. Ensure that your family doesn’t end up in this trap by establishing a will and revising it as needed. A will is the best way to make sure that your wishes are fulfilled and that your assets are divided the way you want them to be.
Shoot for the Stars!
Your financial goals don’t all have to be serious. Make a goal for something that you want or would enjoy doing. Perhaps it’s going on that dream trip, saving for a home, or starting your own business. Whatever your dream is, go for it!
If you are struggling to accomplish these goals, check-in with a financial counselor who is familiar with these issues and can help you through this process.
Denise Kautzer is a Licensed Professional Clinical Counselor and a Certified Public Accountant whose practice is located in St. Paul, MN. You can view her website at www.denisekautzer.com or contact her at denise@denisekautzer.com.