5 Financial Goals to Achieve before You Die

People usually do not have financial goals in their mind when asked about their bucket-list. And it is true that when you are in your deathbed, you would not be thinking about the wrong financial steps you took in your life. However, the living journey can be a lot simpler if you make your financial goals list and work hard to accomplish them. Studies have shown that when the financial part of your life is sorted, most of the other meaningful things automatically fall into place. So, let us talk about the five most important financial goals in your life that you need to set today to have fewer regrets later in your life.

• 1st Financial Goal : Maintain a Good Credit Rating ✔️

Although credit score does not fit the definition of the financial goal, it provides important support to your finances. At different points in your life, you are going to need loans- both in small and large amounts. Your credit score will be the first thing that the lenders check to estimate how creditworthy you are. A better credit score shows the banks that you are a responsible borrower. And the more creditworthy the bank finds you, the lower the rate of interest you will get. Almost all banks and financial institutions use the FICO Score as it works with the data from each of the major bureaus- Experian, Equifax, and TransUnion. So, the goal should be create and maintain a good FICO Score.

• 2nd Financial Goal : Prepare for Emergency ✔️

This should be one of the first financial goals to set in your life. Emergencies can strike anytime, and you must prepare yourself to face such situations by creating an emergency fund. Ideally, you should create a 6-month emergency fund which means the amount that you save should be enough to live the same standard of life even when you are not earning any income for the last 6 months. Assess your monthly expenses and start saving. For an average American, this amount may fall anywhere between $30,000 and $50,000. This may look like a dramatically high figure, but this is a much-needed financial step that you need to take.

• 3rd Financial Goal : Save for Retirement ✔️

Due to the lack of planning, a significant part of the retired Americans do not have as much spending power after they retire and thus they have to lower their standard of living. It is a good idea to link your financial goals to retirement. You should save 10-15 percent of your income in a retirement fund along with your employer’s contribution in the 401(k) plan. You can invest in low-cost, diversified funds of conservative nature. The idea is to save as much amount as you would need to continue the same standard of living as you are currently in. If you are not able to decide how much to save and where to invest, you can take the help of a financial goals planner.

• 4th Financial Goal : Pay off Your Debts ✔️

We have to take multiple loans throughout our lifetime ranging from credit cards and personal loans to mortgages. Before you retire, you should have paid off a significant portion of your debt or completely become debt-free. It is the mortgages that majorly eat into your income so you must make it a goal to pay off your mortgage as soon as possible. You can do this by taking a shorter tenure on your mortgage which will help you save on the overall interest outgo. You would have to shed a few extra amounts per month, but the debt will be gone before you know it.

• 5th Financial Goal : Work for Financial Abundance ✔️

All the above steps are to achieve financial freedom before you die, but if you wish to live in abundance, you would have to take some more steps towards it. You can do this by generating more streams of income. Invest in assets that will generate passive income for you such as investment into high-yield business stocks. The risk will be higher in such cases but it an indispensable element of becoming rich.

The above are just a few financial goals examples. Your financial goals will depend on your financial situation and your dreams. Buying a big mansion may be someone’s dream but for other, it is going for a lavish vacation once a year may be more important. When you make a financial goal, focus on the four major parts- stability, security, freedom, and abundance. These are the four levels to a great financial future; work towards these.

Keep reading interesting blogs. Meanwhile, you can check what an IRA is and why you should open an IRA account.