Are you working and earning some salary or are you an investor and making some profit. Worry not because we have come to your rescue in terms of financial tips. For sure your finances are the ones which drive your life. You may live a life which is stagnant with no growth or live a life full of growth in terms of finances. To achieve this setting of personal financial short term goals is very important. These goals might be of help to you in the short run and both in the long run.
Saving for an Item
In this diverse planet called earth each and every one of us got their own wishes and desires. For instance some people desire to own state of the art cars while others aspire to live in mega structured houses. Rome was not built in a day the same way achieving these goals cannot be done in a single day.
This is the reason why your finances play a major role in achieving this. In order to enjoy the utility of such items you need to fore go the enjoyment of utilities derived from consuming other products. You have to set your short term financial goals in order to achieve this. Take an example of a person who was enjoying a five star dinner each and every Friday and he desires to purchase a car in the next one year.
He will have to decide to forego the five star dinners and instead save the money every Friday. In the first few weeks the cash being saved may look quite useless. But never be tempted to quit your savings schedule. This explains why resources are scarce and they have a price tag on them. After a few months you will realize that your savings are accumulating bit by bit. In the end you will find yourself driving an automobile bought from your weekly savings.
Pay off Debts
Debts are part and parcel of our lifestyle. No one can survive without taking a debt either from a friend or a financial institution. It is quite obvious that the debts come with an interest rate attached to them. The longer you take to settle off a debt the more expensive it is to you. The shorter you take to pay off a debt the less expensive it is.
Having this in mind, then paying off a debt should be one of your short term financial goals. You have to make a decision that this debt is not going to eat up into your finances any more. Property of very many loan borrowers has been auctioned due to their failure to settle off their debts. Why choose not, that your property will never be auctioned for failure to pay your debts.
The most viable method is to pay off the debt in higher installments than agreed with the bank. If you had agreed on $20 a month you may choose to pay double that in a month. If you are capable of settling the debt in one lump sum payment then you can do it.When this is you expect the charges associated with your loan to be reduced. The irony is that, this can only happen if you prioritize settling off your debt as a short term financial goal.
Target small amounts
A small baby cannot run without having to learn how to walk. The tricky part is to ensure that the baby never stops walking. In your financial goals this is arguably the case. You cannot wake up one day and abruptly set up a long term financial goal. You have to start by setting up the short term financial goal then as time goes you will move forward to the long term financial goal.
In investment cycles this is the case. When you decide to start up wholesale and retail stores, the initial capital outlay is very high. You cannot acquire all the capital needed for this venture in one day. Prior planning and market analysis needs to have taken place earlier. Thus in your plans at first might be, to look for money to rent or build the premises. In the following year you save money to do the market research. Finally in the third year you purchase the stock and start the venture. This clearly shows that the short term financial goals coupled together translate into the long term financial goal.
The emergency fund has its roots in the precautionary demand for money. This is where you hold money to cater for the occurrence of events which were not foreseen. For instance you may triple while walking and injure your leg. Definitely, you will need to seek treatment at a cost. The money to cater for the treatment may not be readily available
The importance of the emergency fund comes to focus here. You may choose to hold the emergency fund in form of savings, liquid cash or an insurance cover. This fund will help your cater for your treatment without much hustles and struggles.
Saving for your retirement is also a short term financial goal which one should have. It may be a long term goal but it derives its roots from the short term goal. When one retires you are too old and weak to work. The need for an emergency fund to cater for your day to day needs arises. This is why saving for this fund from an early in advance is important since a lot of funds will have accumulated. Due to this the funds can cater for you till death and leave the surplus to your siblings.
It is very wise for people to learn about the importance of short term financial goals. In order to live a healthy, wealthy happy life in future this vice is very vital. It is my hope that this article has created or awakened some sense in you. What is left for you to do is to practice what you have learnt. Good luck and success.