Congratulations on your 1-Year Anniversary!
You’ve gained an immense amount of knowledge in your first year and you are taking the right steps in planning for your future. The next big step is long-term financial security. Being secure enough to enjoy your life through retirement is usually the last thing on your mind. With the stress of all of the expensive “firsts” – like becoming a homeowner! – it’s hard to think about long term saving. However, working toward financial security isn’t nearly as hard as people assume. You’ve already started on the right path through this first year! Here are some tips to help you out:
Recognize Your Most Important Financial Asset: Yourself
Your skills, knowledge and experience are the biggest assets you have. Look at yourself as a financial asset. Investing in yourself will pay off in the future. Increase your value through hard work, continual upgrading of skills and knowledge and by making smart career choices. Efforts to improve your career can have a far bigger impact on your financial security than tightening your belt and trying to save more.
Become a Planner, Not a Saver
Research has shown that those who plan for the future end up with more wealth than those who do not. Successful people are goal oriented: they set goals and develop a plan to achieve them. For example, if you set a goal to pay off your largest credit card debt in a year, you'll have a better chance of achieving this goal than you would if you merely said you wanted to pay off all of your credit cards, but failed to set a timetable.
Even the process of writing down some goals will help you to achieve them. Being goal-oriented and following a plan means taking control of your life. It is an important step toward improving your financial independence and security.
Set Short-Term Goals – Long-Term Goals Will Take Care of Themselves
Life holds many uncertainties – and a lot can change between now and 30 years from now. As such, the prospect of planning far into the future is a daunting task for young investors. Rather than setting long-term goals, set a series of small short-term goals that are both measurable and precise. As you achieve your short-term goals, set new ones. The constant setting and achieving of short-term goals will ensure that you reach your longer-term goals.
How are you setting and meeting your long term goals?