How to Set Financial Goals for the Short and Long Term
Owning a home is something that most Americans wish to do but feel it’s unattainable because they struggle to feel comfortable financially. High amounts of debt and stagnant wages have made saving money almost impossible for many Americans. In order to potentially save more money, pay off debt and be able to put money toward a down payment on a home.
Short Term Goals
Short-term financial goals can be taken care of in a few months to years. One of the biggest short-term goals is paying down credit card debt. It is important to pay your credit card statement balance every month and avoid just paying the minimum. Paying the minimum payment allows interest to rack up and costs more money in the end.
Another short-term goal is to get rent and utilities to be 30% or less of your income each month. If you are paying more than 30% of your income to rent or utility bills, you may be putting yourself in a position to never get out of the check-to-check cycle.
Putting money back for emergencies can seem daunting. If you are barely paying your bills, saving money seems easy to skip. However, financial planners encourage everyone to have three to six months’ worth of living expenses put aside in case of a layoff, car repair or other costly events. Try putting money into an interest-earning account to see your money do more for you.
Most people have a car loan to pay off. Paying a car loan off can take an average of six years and is one of the most expansive things a person owns. Putting this as a priority can get rid of a fairly large monthly payment sooner.
Long Term Goals
Paying off student loans is usually one of the most mentioned long-term financial goals. Depending how much your loan […]
