The new year is here and now is the time to create personal financial goals to help you get on track.
This will set you up for a more financially stable future.
Sometimes getting your finances organized can be a daunting task, but by setting a few yearly goals, it’s easier than you think.
Start the year off correctly.
Get started on these five simple personal financial goals listed below.
#1 Draft a Monthly Budget
Even though this may seem like a common goal, many people find it hard to complete this task each month and stick to it.
A monthly budget is the beginning of gaining better control of your finances and the more detailed, the better.
When creating your budget, make sure that every penny is accounted for including savings, investments, clothing, food, entertainment, etc.
It will not only help you realize what you spend each month, but it also will help direct your focus on areas where you can improve and goals you can set for the extra money you may have when sticking to your budget.
People have a misconception about budgeting.
Most think it’s about restricting what you spend.
It’s not. It is simply about being conscious as to where you’re money is going.
#2 Take Control of Your Debt
Debt can be one of the primary factors that can hold you back from financial success.
Make a reasonable plan to reduce your debt and stick to it.
You can start by determining a reasonable amount of debt that you would like to reduce for the year.
Make sure that the goal is attainable.
Next, determine how much you will need to pay each month in order to reduce your debt by the goal amount.
Finally, you will need to look at your budget and find a way to fit this amount each month, even if it means cutting back on other areas of the budget.
It is also important to make sure that you do not add any more debt throughout the year.
#3 Make an Emergency Fund a Priority
Medical costs, major vehicle repairs, job layoffs or house maintenance can quickly derail a budget.
Make sure that you have a fund set up specifically to handle these unforeseen expenses.
This means you don’t have to alter your monthly budget to accommodate.
A good rule of thumb for an emergency fund is to start with a month’s after income plus €1,000.
Ideally, you would like 3 months after tax income.
Once this goal is achieved, you should keep saving until you have about six months of expenses.
Add an amount each month in your budget to add to your emergency fund and if you need to use it for an emergency during the year, you will need to regrow it.
#4 Contribute to Retirement Savings
Saving for retirement is something often put on the back burner until it is too late.
The sooner you begin saving for retirement, the more time it will have to grow and the better return you will have on your investment.
The power of compound interest.
Work with us to determine what retirement savings vehicles may be best for you.
Remember, the Government will cover 40% of your contributions (assuming you pay income tax at 40%).
You read that correctly.
If you pay income tax at the higher rate, the Government will cover 40% of your pension contributions.
#5 Create a Long-Term Financial Plan
Goals can be more difficult to set if you are having difficulty envisioning the rewards that will come with financial stability.
Consider any long-term personal financial goals you may have.
Goals such as buying a new house, a new car, regular family holidays or even long term comfortable retirement.
Draft out a plan that includes savings, investing and other ways to build the wealth you need to achieve these goals.
You can start with smaller goals, so they seem less daunting.
Having a plan in place will help you stay on track and guide your financial decisions.
Summary
There you have it.
5 simple, personal financial goals.
The benefits are not just confined to getting your financial house in order.
Unfortunately, a number of studies demonstrate a link between financial worries and mental health.
In fact, the number one cause of stress in America is finances.
This is in a country with a population of €329 million.
It’s so important to look after your finances and take stock.
This is as opposed to living money in, money out month to month without any real idea of what is going on.
Make this year the year you take control of your finances and get on the right track to achieving your future goals.
Consider the five financial goals listed above to help you get started.
They will put you on a sound financial footing for the rest of the year.
How we help
If you would like to discuss the above, schedule a call with us.
We can create a financial plan tailored to you.
This will cover all of the above goals.
We can build in anything you want to.
Kids college fees. Regular family car upgrade. Regular family holidays.
Or longer term objectives like a comfortable retirement.
Take stock of where you are and where you want to go.
Let us do the heavy lifting for you.
You’ll feel better for it.
Let’s have a quick chat about what you want to achieve.
Request a callback or book straight into the diary.
Otherwise, give me a call on 086 0080 756 or drop us an email, info@fortitudefp.ie.
We have over 30 articles we’ve written on various subjects and they can be accessed here.
A wealth of free information covering all aspects of saving, investing, financial planning, protection and pension advice.
Francis McTaggart CFP® SIA RPA QFA
These blog posts are intended for information purposes only and should not be interpreted as financial advice.
You should always engage the services of a fully qualified financial planner before entering any financial contract.
To discuss engaging the services of Fortitude Financial Planning please email us at info@fortitudefp.ie.
Fortitude Financial Planning Ltd will not be held responsible for any actions taken as a result of reading these blog posts.
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