Before we commit to any significant, intentional, long-term changes in life, it's important to take some time to map out the new course we're pursuing. I don't mean a set-in-stone turn-by-turn plan a'la Columbus (we all know how that turned out), think of this more as a fancy new GPS where you're typing in your destination and settings - detours, changes in ETA, traffic, and stops for refreshment will be accommodated for, there's no need to worry about them just yet.
If, like me, you're ready to take control of your financial future and jump into some new spending and saving habits, determining your destination means coming up with some long and mid-term goals for what you want to achieve. In my case, I'm determining exactly how much money I will save in the next 6 months, where that money will be deposited, and what big ticket material investments I also want to make in that time (i.e. a new pair of prescription glasses, snow tires for my car, etc.). What are your financial goals? What is your time line, and what do you want your financial status to be at the end of that period?
Right now, I'm focusing specifically on a six month period because that gives me ample time to both develop and solidify new habits and to start reaping significant benefits from them. Once you determine what your financial destination is, write it down. You'll want to be specific about how much money you will have in each of your accounts (savings, checking, retirement, etc.), how much of your debt you will have paid off, and what investments you will have made.
Now is also a good time to write out why taking control of your financial future is important to you. Why have you chosen your particular destination? Are you building your own nest egg? Are you saving up for a particular investment like down payment or a wedding? Is your focus becoming debt free? Or do you need financial stability for a change in lifestyle, such as starting your own business or going back to school? Without a reason to reach your destination, your unlikely to make it anywhere fast - writing out the reason you're starting on this new path can serve as fuel to get you moving and a helpful reminder to keep you on track.
If, like me, you're ready to take control of your financial future and jump into some new spending and saving habits, determining your destination means coming up with some long and mid-term goals for what you want to achieve. In my case, I'm determining exactly how much money I will save in the next 6 months, where that money will be deposited, and what big ticket material investments I also want to make in that time (i.e. a new pair of prescription glasses, snow tires for my car, etc.). What are your financial goals? What is your time line, and what do you want your financial status to be at the end of that period?
Right now, I'm focusing specifically on a six month period because that gives me ample time to both develop and solidify new habits and to start reaping significant benefits from them. Once you determine what your financial destination is, write it down. You'll want to be specific about how much money you will have in each of your accounts (savings, checking, retirement, etc.), how much of your debt you will have paid off, and what investments you will have made.
Now is also a good time to write out why taking control of your financial future is important to you. Why have you chosen your particular destination? Are you building your own nest egg? Are you saving up for a particular investment like down payment or a wedding? Is your focus becoming debt free? Or do you need financial stability for a change in lifestyle, such as starting your own business or going back to school? Without a reason to reach your destination, your unlikely to make it anywhere fast - writing out the reason you're starting on this new path can serve as fuel to get you moving and a helpful reminder to keep you on track.
