How to set financial goals and why it is important to do so? Is it really needed to set a financial goal before investing money? I have lot of things to do. I have no time in planning a financial goal. Let me investment my money immediately in stocks. I know many investors are growing their money in the stock market. What I want to do is just invest my money, period!
There are no successful people who didn’t start with a plan. Successful investors has financial plan. They stick to it and they will do whatever it takes to achieve a specific goal. You should have a plan and know your goal why you need to take that plan.
Why Do You Need to Set Financial Goals?
In investing, the more you plan for it. The more you become successful. So, how do you start setting your financial goals? First start evaluating your financial situation today. Are your income is enough to cover your lifestyle expenses? If not, you’re still poor. Do you want to make your money work for you instead of you working for money? Then you need a plan.
After evaluating your financial situation, start thinking how much money to invest to retire rich and comfortably. If you are still young, even only a small amount of money can help you achieve your financial goal.Evaluate Your Financial Situation
Example; a $250 per month investment capital that earns at least 7% per annum can give you a total return of $414,700 after 35 years. You need to start with a plan, set aside of money to invest every month. You have to find out which investment vehicle that can give you the highest rate of earnings (stocks and equity mutual funds) can maximize the growth of your investments.
How to Set Financial Goals?
As a guide here’s what you should ask yourself when setting a financial goal.
- How’s my current financial situation?
- How much money to invest to retire rich and comfortable?
- Where to invest my money (which vehicle and which company)?
- Where to redeem my investment (investment horizon: after 10 years, 15 years, 40 years, etc)?
- What to do with my acquired assets when I retire?
The old saying goes “failing to prepare is preparing to fail”. Now, if you want to prepare for your financial future. Today is the right time to prepare for it.
There are many things to consider in setting a financial goal. But, start with a simple question, make a plan and stick to it. You shouldn’t travel in a road without knowing your destination. As simple as that, do not invest unless you know your purpose and goal why you are investing.