Travelling to any place would
require a pre-requisite knowledge of the destination details. Likewise, when it
comes to money, it is very important that one knows where exactly one wants to
end up in terms of the amount of money they want to have and the reason they
want to have it and to create a budget around it. To do this, one needs to set
financial goals to achieve the objectives that one has set. There are basically
three types of financial goals namely
·
Short term goals
·
Mid -term goals
·
Long term goals
Short term goals are those that
might require from a month or two to a complete year to reach while mid- term
goals, require a minimum of one to five years to achieve completion. Long term
goals require five years and above for the same. Once the listing of the goals
is done, a specific deadline needs to be established for each corresponding
task. Accordingly, these tasks can be later integrated into the corresponding
monthly budget. For example:
·
Short term goals – One can easily pay off a sum
of 20000 using a credit card in say 3 to 6 months
·
Mid-term goals – One can invest in the savings
for a 5 Lakh vehicle in 2 to 3 years.
·
Long term goals – Develop some savings plan for a
1 crore corpus for retirement
Since all of us are not
financially savvy, one needs to be practically knowledgeable about certain
matters that we need to know and which will help us in realizing our goals. In
this regard, it may be advisable to refer to major finance portals like the Economic Times, LiveMint,
and Outlook Money, etc. for expert financial advice, tax
breaks and various financial instruments available in the market.
ATTACH BUDGET TO YOUR GOALS
Setting up financial goals is the
first step. This is practically done by everybody. However putting together a
budget and then sticking to a specific budget criteria is a completely different
task. Listed below are some tips which will come in handy while assigning a
budget to your financing goals:
·
Make sure that you separate your high interest
finance accounts from that of the low ones. Instead of leaving a lot of money
idle in Savings Accounts, deploy some in
fixed or recurring deposits, if at all you want to keep a reasonable
amount in the bank,
·
Minimize your expenditures and cut down wherever
necessary. This does not imply that you become a miser and live a meager living
to achieve these financial goals. It is just that if you minimize your extra
expenses by buying what is actually needed rather than wanted, you could save that and invest it to fetch better
returns.
·
Financial goals are the key requirements for an
overall financial health. The only difference that sets you apart from those
rich successful people is the money management mechanism that you follow and
the discipline that you exercise in following it.
While making money is important,
making it last and in fact making it multiply will be a key element in
ultimately determining whether you are able to achieve your financial goals or
not.
