What are your financial goals for 2021?
It’s that time of year again. The time when most of us start setting goals and thinking about what we want to achieve – both in the year ahead, and life in general. But the unavoidable truth is most life goals have some sort of financial element to them. Want to start your own business? You’ll need a savings buffer while you get established. Want to retire at 60? You’ll need a healthy pension to support that lovely long retirement.
You get the picture. Finance is a huge part of how you plan your life. So it makes sense that you need financial goals as well as life goals. Follow these three simple steps to set your financial goals for 2021.
Define your big-picture life goals
Working out what you want to achieve in the longer term will help you set financial goals for the year ahead. So, where do you see yourself in five, 10 or 20 years’ time? Whether you want to buy a house, start a family, take a career break (and finally write that novel), buy a campervan, or retire early – the first step is knowing what you really want.
Break your goals down into bitesize pieces
Now you can turn your big-picture goals into smaller steps – some of which will become your 2021 financial goals. Say, for example, that you want to take a year off and write a book in future. Your 2021 financial goals might include:
• Paying for a creative writing course.
• Starting to build a savings buffer that equates to 12 months’ income.
• Reducing your outgoings so that you can save more each month.
For each of these smaller goals, write a to-do list (for example, create a monthly budget, open a separate savings account). Then set a deadline for each action point.
Track your progress across the year
You’ve got your financial goals. You’ve made a list of action points and deadlines. Now you just need to follow through. At the end of each month, revisit your to-do list and see how you’re doing. If you’ve fallen behind, don’t beat yourself up – simply tweak your deadlines and get right back on track.
Here at Jupp Castle, we offer accountancy and financial services to individuals as well as businesses. So if you want to discuss your financial goals for 2021, we’re here to help. Learn more about working with us.
(Background photo created by wirestock – www.freepik.com)