8 Financial Goals and Milestones to Work Towards Achieving in Your Life

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Having milestones and goals to work towards are important for everyone to have. They give us a sense of drive and satisfaction when we finally achieve that goal. Financially, people oftentimes strive for financial independence or security. We’ve listed below eight common financial goals to work towards in your life to achieve such financial sovereignty.

Track your spending.

To better understand where your money is going each month, it’s good practice to track your spending for a month or two. In doing so, you can get a good idea of where to cut back, or how much to allocate for your budget.

Create a budget.

After tracking your expenses and getting a good idea of where the money you spend goes, set a budget for yourself. Many financial experts recommend a 50-30-20 budget, where 50% of your money goes towards needs, 30% goes towards wants, and 20% goes into savings. If cost of living essentials exceeds 50%, try for a 60-30-10 budget, or even a 70-25-5 if necessary.

Find and cut back on any unnecessary expenses.

Now that you’ve tracked where your money goes, it’s time to cut out unnecessary spending. That streaming subscription probably isn’t worth it at $13.99 per month if you only use it once a quarter.

Create and build an emergency fund.

Saving for retirement is important, but first and foremost, you should have some kind of a safety net for yourself and your family in case things go awry. In 2019, a report from Charles Schwab found that 59% of Americans were one paycheck away from homelessness.[1] It’s important to combat this. Experts recommend having at least one to six months of

Pay off any existing debt.

Once you have your emergency fund, a budget to work with, and have cut out any unnecessary expenses, it’s time to work on getting a handle on your debt. Financial experts generally recommend paying off debt with the highest interest rate, so if one of your cards has an annual percentage rate that is three points higher than another, focus on paying that one off first.

Invest for your retirement.

Investing for your retirement is an important way to ensure that you can enjoy the Golden Years of your life. There are a multitude of financial accounts to invest in, including Roth IRAs, traditional IRAs, backdoor IRAs, rollover accounts and more. To get started, meet with a financial advisor to see what kind of account fits your needs best.

Buy a home or pay off your existing mortgage.

After getting a solid grip on your debt, budget, and retirement accounts, try exploring the idea of buying a home or paying off your existing mortgage. Some financial advisors suggest not paying your mortgage off early so as not to deplete your liquidity, so meet with an expert first before making any big decisions.

Look into long-term care insurance.

By the time you’re gotten a handle on all the aforementioned milestones listed above, it may be nearing time to look into long-term care insurance. Long-term care will be important once you’ve surpassed the age of retirement. Many financial experts suggest buying long-term care insurance in your 50s or early 60s to be the most cost effective.

Financial security and independence are widely coveted concepts that we should all strive for, and the above list is only the beginning of examples that can help get you there. For further assistance with setting, maintaining, and reaching your financial goals, consider speaking with a financial advisor.

The opinions contained in this material are those of the author and not a recommendation or solicitation to buy or sell investment products. This information is from sources believed to be reputable, but Cetera Advisor Networks LLC cannot guarantee or represent that it is accurate or complete. All investing involves risk, including the possible loss of principal. There is no assurance that any investment strategy will be successful.

[1] “2019 Modern Wealth Survey.” Charles Schwab, May 2019, https://content.schwab.com/web/retail/public/about-schwab/Charles-Schwab-2019-Modern-Wealth-Survey-findings-0519-9JBP.pdf. Accessed 01 Jan. 2024.

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