How To Create Attainable Investment Goals
The American Dream is generally considered to finally be free from the shackles of debt, the burden of finances, and the affliction of a 9-to-5 job. But the road traveled to such freedom can be rife with obstacles, and that path can quickly become a nightmare.
Investing is one vehicle that can assist with reaching your destination of financial independence. Having your money work for you is quintessential to not working and enjoying life. But some people set their aspirations a little too high with investing.
Invest your time and read on to find out how to set reachable investment goals.
Devise Your Budget
Everyone has a different budget, so this is up to you to decide how much or how little is right for you. Know this: investing is considered imperative for a reasonable retirement. So, even if your job isn’t the highest paying, preparing for your golden years should start now.
Budget your money wisely. You shouldn’t set aside investment money that would normally go to necessities (housing, food, medical). The “now” is just as important as the future.
You should set aside a small portion of your savings and a small portion of your miscellaneous budget for investment. Instead of going out every weekend, put the money you save while staying home into an investment portfolio.
Giving Yourself Deadlines for Investment Goals
When you’re young, you feel like you’ve got all of the time in the world. But that quickly slips away, and before you know it, the gang at the office is celebrating your retirement today.
You need to have deadlines set for yourself to prepare for the inevitable. Tell yourself when you’re going to do something and do it.
Set a deadline for when you’re going to buy that rental property. Mark your calendar for when you’ll invest in that mutual fund.
Estimate What You’ll Need
Look around you and measure your quality of life. This should be one of the first things you consider when you start planning for retirement.
Consider everything that you own, enjoy, and need to sustain your lifestyle. Some people are fine retiring with $500,000, but most people need considerably more.1
Once you’ve determined this, you should get a gauge of what return-on-investment you should strive for. While some investment vehicles may have the potential for larger returns than others, they will also often be considered riskier. Pick the investment style that’s right with your tolerance of risk.
Can You Measure Them?
A common mistake when setting financial goals is giving yourself too wide of a berth. Goals need to be realistic and they need to be measurable.
Everyone wants to be rich, but how rich? Do you want to be well-off or have too much money?
Measure each of your goals. Determine what you want, and be sure you can quantify it along the way. Perhaps you want to invest; have a goal for an ROI (Return on Investment), perhaps 10%. Just be sure to use a reasonable and attainable percentage when you are determining this.
Now, You’re Invested
Investing is considered one of the best ways to achieve financial success. But it can be intimidating getting there. You need investment goals to guide you.
Devise a budget for yourself, deadlines, an estimate for your future needs, and measures for your goals.
Are you interested in investing wisely? Reach out to us for consultation.
1 “Retirement living: Here’s what it costs to retire comfortably in every state” Michael B. Sauter, USA Today, Aug. 17, 2020
