The right financial goals give you a plan, guide your day-to-day money choices and help you to realise your dreams. And the best part? Anyone can do it. You just need to get started.
It’s a new year filled with new opportunities, but if 2020 has taught us anything, it’s that things don’t always go as planned. And while there’s still so much uncertainty about how this year is going to go down, one thing you can try to control is your cash. How do you do that? Set some goals!
But, this is no New Year’s resolution that you forget about quicker than you can say “Janu-worry”. To reach your goals you need to work on them every day in small ways. By doing this you can save for your future, pay off debt and build an emergency fund (something many of us could have used last year, right?).
4 steps to set and reach your financial goals
Step 1: Set your goals and write them down
Are you paying off a student loan? Do you cringe every month when your credit card bill arrives? Is there a special holiday you fantasise about but don’t think you can afford? What about that dream home? With the right financial goals, anything is possible.
Sit down, think hard about what you want and write it down. List them in order of importance. Now pin your list somewhere where you can see it every.single.day.
Top tip: Start with getting rid of debt. Real financial freedom doesn’t always mean you have millions in the bank – it begins with being debt-free.
Step 2: Create a budget
Do you remember how much you spent over December (or what you spent it on)? If there’s always a bit too much month left for your money, a budget is an excellent way to track (and control) what you spend.
Start by writing down your income and then listing all of your main expenses, including food, travel, rent and any other monthly bills you have. Next, write down every cent you spend for four weeks. If you don’t want to carry a notebook and pen around, there are great free apps available on Google Play and iOS that will help you to keep track. You might be surprised by how much you spend on impulse buys and unnecessary items.
Once you know what your monthly expenses are and what you spend each week, create a budget, making sure that you spend less than you earn. Set limits for yourself and include your financial goals in your plan.
Top tip: Pay special attention to the small expenses that are gone in an instant but contribute to your empty wallet. For example, work out how much you spend on buying a cup of coffee or lunch every day. You can remove this from your spending entirely by making your own, and watch your bank balance grow.
Step 3: Work your financial goals into your budget
Go back to the financial goals you’ve written down and calculate how much you need for each of them. TymeBank’s GoalSave calculator can help you work out how much you need and for how long you’ll need to save to reach your goals.
Now add your goals to your budget as monthly expense items. A good rule of thumb when it comes to saving is to put 10% of your salary aside each month. That might sound like a lot, but you can start with a little less and work up to 10% as you get used to saving.
Top tip: Don’t wait until the end of the month to pay off debt or put your savings aside. Treat savings like any other expense that comes off on the first of the month. Once it’s gone and safe, you can’t spend it – out of sight, out of mind.
Step 4: Start small and stick to it
The key to achieving any financial goal is to start small and keep it realistic. If you try to put half your pay cheque aside each month, we admire your enthusiasm, but chances are you’ll be continuously dipping into your savings and your plans will soon take a back seat to day-to-day living.
Top tip: Set a realistic plan (based on your budget) that allows you to start developing some healthy money habits. The best part of starting small is that as you reach your goals and watch your bank balance grow, you’ll be motivated to keep working on it. You’ll be amazed how much you’ve put aside at the end of the year if you just keep at it – and best of all? You’ll be earning interest, so your cash will grow!
Get started today
If you’re serious about achieving your financial goals in 2021, TymeBank offers a great tool to get you started. Watch your savings grow day by day with GoalSave, a savings tool linked to your EveryDay account that you can monitor and control from your smartphone.
With GoalSave you can:
- Save for up to 10 different goals at the same time
- Earn more the longer you save
- Get as much as 8% interest a year
- Use the GoalSave calculator to work out how much you need and for how long you’ll need to save to reach your goals.Get started now. Go to TymeBank's GoalSave page and start saving towards your financial goals!