“Rich isn’t a goal. Five million in 3 years is a goal.”
While five million is probably a bit out of reach for the majority of us, the concept is still a good one.
Where do you want to be financially in 1 year? 5 years? 10 years? It is good to have both short and long term goals.
Don’t make your goals too broad where you can’t measure if said goal was actually attained. Rich – what does that mean? there is no monetary value here, making the actual goal difficult to measure.
You also should make sure that the goals you set for yourself are attainable. You don’t want to set yourself up for failure with some outrageously unreachable goal.
Make your short term goals more specific. I want to pay off my car loan in 1 year. I want to save $1,000 for an emergency fund in the next six months. These are attainable and measurable goals.
Set yourself 2-4 short term goals for the next six months to one year.
Here are MY personal short-term goals that I want to reach within that time frame;
- Pay a minimum of $200 extra to loans every month (This does not include minimum payment)
- In one year – cut total loan balance in half
- Pay a minimum of $50 to savings account every month (Have a MINIMUM of $1,000 at all times)
Your long term goals can be a bit more broad than your short term – However they should still be measurable and attainable.
Set yourself 3-5 long term goals for the future (2+ years).
Here are MY personal long-term goals for the future;
- Pay off ALL loans by the year 2020
- Have a minimum of $20,000 saved for a down payment on a house within the next 2-3 years
- Get credit score above 800
- Build up miles on credit cards for future travel (Who doesn’t love FREE flights?!?!)
As you can see, my long term goals are a bit more broad than my short term. The time frame is a longer period, as well as some are just general goals without any specific timeline.
These don’t have to be complicated! If you have read any of my blogs you know that I love to make my finances as simple as possible.
I find it easier to come up with your long term goals FIRST, followed by short term goals that can help you achieve them. Do you want to be financially independent? Figure out how to make a monthly goal to help you towards that independence. Do you want to buy a house? Put money into an account for a down payment to lower your interest rates when you buy.
Think of your long term goal and start coming up with ways to make that possible – Like I said, its as simple as that!