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Long-Term Financial Goals: 6 Examples

Posted by Yvonne Talbott Scoggins on October 14, 2021

Long-Term Financial Goals: 6 Examples

Every day, you make small decisions that impact your financial future in one way or another. However, it’s also crucial to set long-term financial goals to guide you toward wise choices that will enable you to create the life you desire in your later years. Knowing your objectives and writing them down helps keep them top of mind as you make decisions about saving and spending your money.

In this article, we’ll share six long-term financial goals examples to get you thinking about creating your own goals-based financial plan. We’ll also offer four tips to help make the process of reaching your objectives smoother.

Are you looking for guidance around building a financial plan that will get you closer to your long-term goals? Schedule a call with Bay Point Wealth today to find out how we can help.

4 Tips For Achieving Your Long-Term Financial Goals

The average American family has $6,270 of credit card debt. This number can make the prospect of reaching your objectives seem like a challenge. You may wonder, “Will I ever achieve my long-range life goals?” Despite having to settle debts and save for retirement, there are a few helpful tips you can follow to move toward your objectives.

1. Write down your goals.

Set measurable goals for yourself or your family, and be specific about the timeframe required to achieve them. Clearly outline the steps you need to follow so you can assess your success later when the time comes to review your progress.

Once you’ve determined how much money you must save to reach your long-term financial goals, this figure should become part of your budget. If you’re married, go through the goal-setting and budgeting process with your spouse and have an open conversation about what is important to each of you. This will help you work together, taking actionable steps to achieve your future objectives.

2. Set a regular time to review your goals.

Review your long-term financial goals monthly to keep them top of mind. Track your progress to see whether you’re spending money on things that take away from your ability to reach your objectives. Life is always changing, and you need your budget to keep up. This is another reason to do a monthly financial review.

Going through the review process with your family will give you an opportunity to hold each other accountable for your spending, as well as to celebrate your wins. Regular communication will also help keep your family on the same page about your collective financial goals.

3. Work with a financial advisor.

Seeking expert advice can give you valuable insight into which kind of long-term financial goals are reasonable and achievable for you. An objective third party can also take emotion out of the financial planning process and put you at ease if you have worries or concerns. In addition, a financial advisor will help you stay disciplined and stick to your plan.

Financial advisors are well-versed in the best savings and investment accounts to use based on your specific goals—and how to maximize your wealth. They’ll read your employee benefits package in detail, including the fine print of your 401(k) plan, to ensure you’re leveraging all of the perks offered by your employer. They’ll also help you take advantage of changes in your tax bracket.

4. Plan for fun.

Think of your financial plan like a diet: if it’s too restrictive, you won’t be able to stick to it, so be sure to budget for things you enjoy. One of the main purposes of financial planning is to live the life you want, even as you save for mid- and- long-term goals. It’s important to make the most of every season in life as best you can.

6 Long-Term Financial Goals Examples

These six examples of key long-term financial goals can act as achievable benchmarks to help you attain financial stability. Once you reach that stability, you can move on to your next objective as your financial success grows. However, keep in mind that sometimes you need to tackle more than one goal at a time.

1. Pay off your debt.

Debt is an example of a long-term goal that’s relevant to many Americans. A good approach is to prioritize paying off your debt based on interest rate. For example, your mortgage will likely be the last debt you're concerned about, whereas you should tackle credit cards right away, then student loans, and then car loans.

Online calculators like this one from NerdWallet can help you figure out how to best pay off your debt. Focus on the debt with the highest interest rate first and pay a minimum amount on all your other debt. Once you pay off your primary debt, put all of the money that was going toward it to the next one.

2. Create an emergency fund.

While saving three to six months of your expenses is ideal, this can be a big hurdle to clear. You may only be able to save a portion of this money while paying off your debt. However, if you're a homeowner, you can use a home equity line or your home insurance to cover your expenses in a true emergency—you’ll just need to pay your deductible.

Spend time thinking about the kinds of emergencies you need to save for, whether that includes car trouble or potential medical bills. This will help you gain a clearer picture of the amount you need to save.

3. Send your kids to college.

Catching up on saving for college can be challenging if you wait too long to get started, making it an example of a long-term goal worth working toward. Getting an early start and using the right type of savings account is key. There are four common accounts for saving for college, including 529 plans, Education Savings Accounts (also known as Coverdell IRAs), Custodial Accounts, and Prepaid Tuition plans. They each have different benefits and limitations. An advisor can help you choose which is best for your family.

Decide how much money you want to put aside for your children’s education, and don’t feel obligated to save for 100% of the costs or send them to an Ivy League school. Involve your kids in the conversation and discuss various options with them, as well as the costs of each one. It’s perfectly fine for your children to bear some of the financial responsibility for their education. And remember, don’t borrow from your retirement fund to send your kids to college.

4. Save for retirement.

You should be able to put at least 20% of your net income aside for retirement. This may seem like a lot, but as life expectancies increase and pensions become more scarce, it’s important to ensure you’ll have enough money to support you in your golden years.

A financial advisor can help you figure out how best to save. For example, after you max out your 401(k), you may be eligible to make after-tax contributions, which many people don’t know is an option. If your 401(k) plan also allows you to convert those after-tax contributions to a Roth IRA, you can avoid paying taxes on the earnings of those contributions.

5. Save for travel.

Saving for travel or other leisure activities you enjoy is an example of a long-term goal that makes life richer (pun intended). If you’re really looking forward to a trip or another event, even though you may need some time to save, and it’s more than what your budget normally allows, it’s worth your while so you can look back on the memories.

6. Buy an investment property.

An investment property can provide you with an income stream that you continue to own after your mortgage is paid, acting as another asset in your retirement plan. If need be, you can also borrow against an investment property to help cover large expenses like college tuition. However, before you set your sights on this lofty of a goal, it’s important to have covered your financial basics, including paying off debt and creating an emergency fund.

Get Guidance On Your Financial Goals

As fiduciary financial advisors, your success is our first priority at Bay Point Wealth, and we’re legally obligated to put your best interests ahead of our own. We’ll craft a plan for your financial future by deeply understanding your goals and then exploring different scenarios to help you reach them. Schedule a call with us today to find out how we can put our comprehensive financial planning expertise to work for you.

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Topics: Financial Planning