2018 has already arrived. Now is the time for you to set some serious financial goals and chalk out the strategies for achieving your success.
Didn’t get any time to make a list of new financial goals for the year 2018?
Don’t worry. We have compiled a list of six best financial goals to be financially smart – that will help you to improve your wallet and your life in 2018!
1. Pay off your debts
Decide how much debt you wish to get rid of in 2018. The best option is to get out of debt completely. But it may not be possible depending on your income and debt amount. So set an amount you can pay off in 2018 with strategic planning. Figure out how much extra you want to put towards your debt every month and then try to reach it. You can follow a debt repayment plan to speed up your repayments. Smart investments help to accelerate your savings. Likewise, unpaid debts eat up your savings. Late fees, compounding interests, fines, finance charges, penalties, etc. increase your outstanding balance, and you end up paying more in the long run. So, make it your goal to get rid of debt in 2018.
2. Review your investment plans
Investments should be made with particular goals in mind. They should help you attain your financial goals in 2018. Have a look at where your investments are now and evaluate your progress.
Here are a few tips to review your investment plans:
(i) Calculate your actual return to know if you’re on the right financial track. Once you get the number, compare it to your expected return. Find out if you have made any financial progress in the last few years.
(ii) Compare each individual holding to a benchmark. This comparison would help you discover portions of your portfolio that need adjustment. Monitor those parts of your portfolio every month.
(iii) Analyze your overall asset allocation to identify the areas where you need to make changes. For instance, sell those investments that are not meeting your expectations. If you don’t have proper information or tools to review your investment mix, then it’s best to consult a qualified and experienced CPA financial adviser. He can make an in-depth analysis of your portfolio and help you make the required changes.
3. Stick to your budget every month
Budgeting is vital for proper allocation of funds and resources. It helps you know the amount designated for each expenditure line. A budget also assists you to determine the maximum amount to be spent on a particular item. If your goal is to invest in the stock market in 2018, then budgeting can help you a lot. Your budget gives you a better idea of how much you can invest or save in a particular month. Remember, if you can stick to your budget, then you’re financial goals will be reached more effectively.
4. Invest more in your retirement plans
Do you have a 401(k) plan? If not, open an account today. How much are you contributing to your 401(k) plan every month? Is it enough? Are you getting the maximum employer match? If not, then find out if there is a “catch up” opportunity this year. Increase your IRA contribution if you haven’t reached the maximum limit for the current financial year. Take full advantage of the new year’s opportunity for building your nest-egg.
5. Choose the right 529 plan
The right 529 plan can help to accelerate college savings. Research and choose the right 529 plan in 2018 by the following factors:
(i) State tax benefits
(ii) Investment choice
(iii) Fees and costs
(iv) How much you have to invest initially
A good way to kick-start your college savings is to invest a set amount each year. Consider the daily expenses you need to take care of and select a plan that has a minimum investment.
6. Create a long-term financial plan
Where do you see yourself after five years? Do you see yourself
living with your children in a nice house? Do you see yourself leading a peaceful life? The answers to these questions help you create a long-term financial plan.
Outline your timetable:
● When you’re planning to buy a new apartment
● When you’re planning to switch job
● When you’re planning for retirement
● How you’re planning to build wealth
● What type of investments you’re interested in
● How you’re planning to invest your money
● When your kids will go to college
A long-term financial plan can help you make the right financial decision not only in 2018 but also in the next few years. Try implementing these six best financial goals into your life. Note: Don’t compare your long-term financial plan with others since it won’t be beneficial for you. Your long-term financial plan will be different from your best friend’s, especially if he is married and you’re single. I hope you understand my point.
Summing It Up
Remember, you have to work hard and make plans to achieve your financial goals. Believe in yourself, set a strategic course of action, and start making positive changes using these six best financial goals to get your money matters organized. Best of luck! Patricia