How regularly in life have you possessed the capacity to achieve something without first defining what it is that you’re endeavoring to do? For instance, have you landed another job without first choosing to apply for it? Did you buy another car without first considering your choices and then choosing it was the ideal opportunity for an upgrade? It’s possible that in each of these circumstances your initial step was to recognize your objective(s) and from that point create a plan of attack to reach them. The same situation applies to sorting out your monetary life. One of the initial phases in financial planning is setting objectives. Setting objectives permits you to determine your expectations and dreams for your future, both short and long term.
At the point when pondering and setting your objectives, ask yourself what might need to happen in the following 3, 5, 10+ years in order for you to be happy. From that point, start to document and shape your objectives and make sure that they are S.M.A.R.T
S.M.A.R.T. objectives are:
- Time Frame
For an objective to be particular, the more details, the better! You need your objectives to incorporate as much information as possible. For instance “I need to save $25,000 for an initial deposit on a home in the next 4 years” is an objective that answers “the amount?” “How long?” and “what for?”
Measurable objectives should allow you to monitor your progress. How close are you to reaching your objective? How much more do you need to save?
Achievable objectives are those that are realistic in nature. While we may all want to win the lottery or have a huge house or great new car – your objectives should be set within reach. Perhaps maximising your contributions to your superannuation fund, or building up an adequate emergency savings account is a good place to start.
You want your objectives to be relevant to your life. Your objectives should reflect yours and your family’s needs, values, and desires. Make sure your objectives are meaningful to you or else you will not be motivated to achieve them.
Timely objectives are those that come with a deadline. Ask yourself how long it will take you to achieve your objective. Working within a timeframe allows you to better track your progress.
When setting your financial objectives, remember to write them down, prioritize them, and keep them in a place where you can see them often. Include your significant other or family in the objective setting process to make sure you are all on the same page. Your objectives will be the basis of any financial plan you create. Not only will having a clear vision of what you hope to achieve keep you on track, but you will be inspired to stay organised and turn your hopes and dreams into a reality.